Net FX flows through economy surge by 245.9% in one year

More foreign currency entered the economy in the past one year as the net foreign exchange (FX) surged by 245.9 percent.

Data from the Central Bank of Nigeria (CBN)’s economic report showed that the net FX flows through the economy rose to $5.95 billion as of November 2024 compared to $1.7 billion in the corresponding period of November 2023.

The net FX flow is the difference between the total inflows and outflows of foreign exchange. A positive net FX flow indicates that more foreign currency is entering the economy than leaving, which can strengthen the country’s foreign reserves and exchange rate.

Nigeria’s external reserves rose in the review month and were above the international benchmark of three months of import cover. The international reserves rose to US$40.38 billion at the end of November 2024, from US$39.71 billion at the end of October 2024. The position could cover 9.16 months of import for goods and services or 13.71 months for goods only.

On a monthly basis, the economy recorded a lower net foreign exchange inflow in November 2024, on account of decreased
inflow through the Bank. Foreign exchange flows through the economy amounted to a net inflow of US$5.95 billion, relative to US$4.86 billion in October 2024.

Aggregate foreign exchange inflow declined to US$8.40 billion, from
US$9.15 billion in the preceding month. Similarly, foreign exchange outflow decreased to US$2.45 billion, from US$4.29 billion in the preceding month.

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Foreign exchange inflow through the Bank declined to US$2.91 billion, from US$4.48 billion in the preceding month, while autonomous inflow increased to US$5.49 billion, from US$4.67 billion in the preceding month. Outflow through the Bank fell to US$2.09 billion, from US$3.73
billion in the preceding month, while autonomous outflow
fell to US$0.36 billion, from US$0.56 billion in October 2024.

Consequently, the Bank recorded a net inflow of US$0.82 billion, compared with US$0.75 billion in October 2024, while a net inflow of US$5.13 billion was recorded through autonomous sources, relative to US$4.11 billion in the
preceding month.

The naira depreciated against the US dollar at the Nigerian foreign exchange market during the review
period.

The average exchange rate of the naira per US dollar at the Nigerian foreign exchange market (NFEM) depreciated by 1.78 per cent to N1,670.78/US$, from
N1,641.12/US$ in the preceding month.

Conversely, at the end of the period NFEM rate appreciated by 0.39 per cent to N1,663.90/US$, from N1,670.47/$ at the end of October 2024.

The average foreign exchange turnover at the NFEM rose by 24.78 per cent to US$301.52 million, from US$241.65 million in October 2024, due to increased activity in the window.

Hope Moses-Ashike

Hope Moses-Ashike is an Associate Editor, Banking and Finance, with more than a decade of experience reporting on Nigeria’s financial system and broader economy. She closely tracks market movements, monetary policy decisions, company disclosures, regulatory actions, economic indicators, and global developments, and interprets what they mean for businesses, investors, policymakers, and households. Her reporting helps readers understand complex issues such as inflation trends, foreign exchange market dynamics, interest rate decisions, bank performance, and investment risks. She also covers major international events and periodically travels to Washington, D.C., to report on the World Bank/IMF Spring and Annual Meetings. Her dedication to financial journalism has earned her multiple recognitions and invitations to high-level professional development programmes. She is an alumna of the International Visitors Leadership Programme (IVLP) in the United States and holds an Advanced Financial Journalism Certificate from the Press Association Training in London, UK. Her other notable achievements include completing the Lagos Business School CMC Programme, the Bloomberg Media Africa Initiative Programme, and a Master Class in Journalism at Rhodes University in South Africa.