Nigeria’s external reserves increased by $2.16 billion to close the month of July at $39.35 billion, up from $37.19 billion in June, according to the Central Bank of Nigeria (CBN).
The 5.8 percent growth was supported by improved foreign exchange inflows, stronger portfolio investments and higher crude oil production.
At the current level, reserves provide cover for about nine months of imports, reinforcing market stability.
Official FX Market Performance
The naira depreciated slightly by 0.3 percent at the official market in July. The currency opened the month at ₦1,529.57 per dollar and closed at ₦1,533.55. On the final trading day, the naira gained 0.06 percent to ₦1,533.55 from ₦1,534.52 the previous day.
At the parallel market, the naira closed the month at ₦1,560 per dollar, unchanged from the start of July. However, it lost ₦10 on the final day, weakening from ₦1,550 to ₦1,560.
Analysts’ Position
United Capital Research projected that sustained inflows and stable reserves could support mild appreciation in the second half of the year with the naira expected to close within the ₦1,490 to ₦1,520 range.
Professor Uche Uwaleke, President of the Capital Market Academics of Nigeria, said the increase in reserves from $33 billion in December 2024 to about $39 billion in July reflects the impact of CBN reforms.
He noted that the parallel market premium has narrowed from 35 percent in March to around 18 percent, underscoring improved market efficiency.
Outlook
Analysts expect reserves to remain supported in the coming months by FX reforms, portfolio inflows, and planned borrowings, including $21 billion in external loans and a $2 billion domestic dollar facility.
The $1.1 billion Eurobond repayment scheduled for November is not expected to place significant pressure on reserves.