Nigeria’s economy witnessed a decline in net foreign exchange inflow in January 2025, attributed to reduced contributions through the Central Bank of Nigeria (CBN).
The January 2025 CBN Economic Report, released on April 17, reveals that net foreign exchange inflows amounted to $4.79 billion, a 4.49% decrease compared to $5.01 billion recorded in December 2024.
The report outlines significant fluctuations in both aggregate inflow and outflow. Aggregate foreign exchange inflows dropped to $9.63 billion in January 2025, down from $10.17 billion in December.
Similarly, foreign exchange outflows decreased to $4.84 billion from $5.17 billion over the same period.
The decline in foreign exchange inflows through the CBN was notable, falling to $2.33 billion from $4.09 billion recorded in December 2024.
Meanwhile, autonomous foreign exchange inflows saw an increase, rising to $7.31 billion in January compared to $6.08 billion the previous month.
On the outflow side, funds through the CBN fell to $3.80 billion from $4.16 billion, while autonomous foreign exchange outflows slightly increased to $1.04 billion from $1.01 billion in December.
This shift resulted in a net outflow of $1.47 billion through the apex bank during the review period, a sharp contrast to the marginal net outflow of $0.07 billion recorded in December 2024. Conversely, autonomous sources recorded a net inflow of $6.26 billion, significantly higher than the $5.07 billion noted in the preceding month.
The report highlights a strengthening of the naira against the US dollar at the Nigerian Foreign Exchange Market (NFEM).
During the review period, the average exchange rate appreciated by 1.16% to N1,535.94/USD, up from N1,553.73/USD in December 2024.
Furthermore, the end-period NFEM rate improved by 3.90%, reaching N1,478.22/USD compared to N1,535.82/USD at the close of December.
The NFEM also experienced increased activity during this period. Average foreign exchange turnover rose significantly, climbing 18.30% to $408.49 million from $345.30 million in December 2024.
This uptick reflects heightened transactional activity and improved liquidity within the foreign exchange market.
Nonetheless, fluctuations in aggregate inflows and outflows highlight the importance of monitoring foreign exchange dynamics and addressing structural inefficiencies to safeguard macroeconomic stability.