Nigeria’s external reserves declined to $40.09 billion as of January 21, 2025, according to data published by the Central Bank of Nigeria (CBN).
This represents a decline of $832.62 million, or 2.03% from $40.92 billion recorded on January 6, 2025.
On January 13, the external reserves dropped below $40.6 billion for the first time this month to $40.56 billion and by January 15, the figure had further moderated to $40.42 billion before settling at $40.09 billion on January 21.
The cumulative reduction of $832.62 million reflects mounting pressures on Nigeria’s foreign exchange reserves amidst macroeconomic uncertainties.
Experts have attributed the decline in external reserves to the persistent increase in demand for foreign exchange and external debt servicing obligations.
However, if the trend continues unabated, analysts project a further decline to below $40 billion by the end of January 2025.
The current decline comes after five months of relative stability and growth in the reserves, which had offered a buffer against exchange rate volatility.
However, the recent downward trend mirrors the challenges faced in April 2024 when reserves plunged by $2.16 billion in less than a month due to debt repayments and external obligations.
At the time, CBN Governor Yemi Cardoso attributed the declines to “standard financial obligations” and explained that the reduction was not a direct effort to defend the naira.
Similar dynamics may be at play now, as Nigeria continues to grapple with fiscal and monetary pressures.