Nigeria’s Foreign Reserves Drop by $499m in Two Weeks -What It Means for the Naira

Nigeria’s foreign reserves fell by $499.46 million in less than two weeks, declining from $50.02 billion to $49.53 billion between March 11 and 25, 2026, according to the latest external reserves movement data published by the Central Bank of Nigeria (CBN).

The approximately 1% decline within a fortnight raises fresh questions about reserve sustainability at a time the CBN is implementing wide-ranging monetary and foreign exchange reforms.

How Much Are Nigeria’s Foreign Reserves in March 2026?

As of March 25, 2026, Nigeria’s gross external reserves stood at $49.53 billion — down from $50.02 billion on March 11, 2026. The $499.46 million depletion occurred in less than 14 days, representing one of the more notable short-term reserve drawdowns recorded in recent months.

The current figure also falls below the CBN’s 2026 reserve projection of $51.04 billion, as outlined by Governor Olayemi Cardoso at the 2026 Macroeconomic Outlook for Nigeria.

“The external reserves are projected at $51.04 billion in 2026, compared with $45.01 billion in 2025,” Cardoso had stated.

Why Are Nigeria’s Foreign Reserves Declining?

The reserve decline comes despite a series of sweeping CBN policy reforms aimed at strengthening the foreign exchange market and boosting inflows. Several factors may be contributing to the drawdown:

CBN intervention in the FX market: The apex bank regularly deploys reserves to defend the naira and smooth exchange rate volatility. With the naira trading at N1,383.88 to the dollar as of Thursday, March 27, 2026, pressure on the local currency may be prompting intervention.

Policy transition costs: The CBN recently reversed its cash pooling requirements for international oil companies (IOCs) operating in Nigeria, now allowing 100% repatriation of export earnings. While this reform is designed to attract long-term investment, it may reduce the volume of dollar inflows retained onshore in the short term.

IMTO routing directive: The CBN also mandated International Money Transfer Operators (IMTOs) to route transactions through designated naira settlement accounts — a structural change in remittance processing that may temporarily affect inflow timing and settlement patterns.

Nigeria’s Reserve Target vs. Reality: Is the CBN on Track?

Despite the recent dip, Nigeria’s reserves remain significantly higher than the $45.01 billion recorded in 2025 — a year-on-year improvement of more than $4.5 billion. However, the gap between the current $49.53 billion and the projected $51.04 billion target means the CBN must attract an additional $1.51 billion in net inflows to meet its 2026 goal.

What Is the Naira to Dollar Rate Today?

The official naira to dollar exchange rate stood at N1,383.88 on Thursday, March 27, 2026, under the CBN’s willing-buyer, willing-seller framework. The apex bank has previously reported narrowing the parallel market premium to below 2% — a key benchmark of its FX reform success.

CBN Reforms Driving the Foreign Exchange Outlook

The reserve movement data comes at a pivotal moment for Nigeria’s external sector policy. The CBN has recently introduced several reforms with direct implications for reserve levels and naira stability:

1. IMTO Naira Settlement Directive The CBN mandated all International Money Transfer Operators to route inbound remittances through designated naira settlement accounts. The policy is aimed at improving traceability and reducing dollar leakages in the remittance pipeline, a market the CBN has targeted to grow to $1 billion in monthly inflows by end-2026.

2. Reversal of IOC Cash Pooling Rules. By allowing international oil companies to repatriate 100% of export earnings, the CBN is signalling a more liberalised approach to capital flows. While the long-term goal is to incentivise more upstream investment, the short-term effect may be reduced dollar retention within Nigeria’s banking system.

3. FX Market Transparency Measures: Tighter interbank reporting standards and improved surveillance continue to underpin the official FX market’s credibility, even as reserve levels fluctuate.