•Renewed Investor Confidence, Stronger Oil Receipts, and Stabilized Forex Market Drive Reserves to Highest Since 2018
••Inflation Declines Sharply Amid Economic Reforms; Nigeria’s Credit Ratings Improve
Nigeria’s foreign reserves have reached $46.7 billion the highest level in seven years signaling a robust improvement in the country’s macroeconomic landscape, the Central Bank of Nigeria (CBN) announced Tuesday. The reserve level, recorded on November 14, 2025, provides over 10 months of import cover, representing a significant buffer for the economy and a major milestone in the ongoing reform agenda spearheaded by the CBN.
Delivering remarks at the 20th Anniversary of the Monetary Policy Department (MPD) in Abuja, CBN Governor Olayemi Cardoso, represented by Deputy Governor Dr. Muhammad Abdullahi (Economic Policy), credited this remarkable increase to a combination of renewed investor confidence, stronger portfolio inflows, improved oil revenues, and policies that have successfully stabilized the foreign exchange market.
“Foreign reserves have risen to $46.7 billion, supported by sustained inflows and renewed investor participation across various asset classes,” Cardoso stated. He highlighted that the Nigerian Naira has firmed up against the dollar, with the spread between the official and Bureau-de-Change exchange rates narrowing to less than two percent, reflecting restored market confidence.
Inflation Eases Significantly Amid Reforms
Alongside the surge in reserves, Nigeria is also witnessing a marked reduction in inflationary pressures. Headline inflation slowed to 16.05% in October 2025 — down sharply from 34.6% in November 2024 — marking seven consecutive months of disinflation and the lowest rate in three years. Core inflation has also begun to soften, underpinning the positive trajectory toward price stability.
Reforms Foster Improved Global Perception
Governor Cardoso underscored that recent economic reforms have played a crucial role in reshaping investor sentiment and strengthening Nigeria’s macroeconomic outlook. He pointed to upgrades by all three major international credit rating agencies, including S&P Global Ratings’ revision of Nigeria’s outlook from stable to positive.
The removal of Nigeria from the Financial Action Task Force (FATF) Grey List further enhanced the country’s international credibility, unlocking improved access to trade finance and expanding investment inflows. These developments, Cardoso noted, collectively contribute to “a more competitive currency, improved trade balances, and a stronger foundation for inclusive development.”
Monetary Policy Department at the Heart of Economic Stability
Celebrating two decades of the Monetary Policy Department’s contributions, Cardoso praised its central role in evolving Nigeria’s monetary framework. Key achievements include the introduction of the Monetary Policy Rate in 2006, the establishment of an interest rate corridor system, enhanced policy communication strategies, and the country’s transition to an inflation-targeting regime.
“The Department must remain agile and forward-looking,” he cautioned, given ongoing global economic uncertainties, commodity price volatility, and internal structural challenges. Cardoso advocated for enhanced analytical capacity, adoption of advanced data modelling techniques, and greater deployment of technology and big data to refine policy decisions.
He identified the full adoption of inflation targeting as a priority, emphasizing, “Inflation targeting will enhance transparency, improve credibility, and strengthen the effectiveness of monetary policy transmission.”
Context: Nigeria’s Return to International Capital Markets
The surge in reserves follows closely on the heels of Nigeria’s recent successful $2.35 billion Eurobond issuance, hailed as the largest orderbook in Nigerian history with $13 billion in investor demand. The Federal Government’s ability to attract such unprecedented foreign interest was described by the Debt Management Office (DMO) as a clear endorsement of Nigeria’s economic reforms, fiscal discipline, and long-term growth prospects.
This strong international backing, combined with domestic policy achievements, positions Nigeria for sustained economic recovery and growth as the country navigates complex global and local challenges.
