Total inflows into the Nigerian Foreign Exchange Market (NFEM) climbed to a five-month high of $4.36 billion in July, driven by stronger Central Bank of Nigeria (CBN) interventions and increased participation from local sources. The latest data from FMDQ showed that Nigeria forex inflows rose by 31.9 per cent from $3.31 billion recorded in June, with local sources contributing 66.7 per cent of the total inflows.
According to the report, inflows from local sources increased by 79.8 per cent to $2.91 billion, compared with $1.62 billion in the previous month. The sharp growth was mainly supported by a significant rise in CBN interventions, which expanded by about 11.8 times month-on-month, alongside a 31.9 per cent increase in contributions from non-bank corporates.
However, the gains were partly offset by weaker inflows from individuals, which dropped by 54 per cent, while exporters’ contributions declined by 12.9 per cent during the review period.
Meanwhile, inflows from foreign sources fell by 13.9 per cent to $1.45 billion, down from $1.69 billion in June. The decline reflected weaker foreign portfolio investment (FPI) and reduced inflows from other corporate investors. FPI dropped by 18.5 per cent, following a 53.2 per cent fall in equity investments and a 16.1 per cent decline in fixed-income investments. In contrast, foreign direct investment (FDI) rebounded strongly, rising by 388.3 per cent and helping to cushion the overall decline in foreign inflows.
Despite the increase in Nigeria forex inflows, the naira weakened by 0.5 per cent week-on-week to close at ₦1,369.09 per United States dollar, as local demand exceeded available foreign exchange supply. Nigeria’s gross external reserves also recorded their first weekly decline in three months, dropping by $107.73 million to $51.92 billion as of 30 July 2026.
Analysts at Cordros Research expect the naira to remain broadly stable, supported by resilient portfolio inflows, sustained investor confidence, and a widening current account surplus. They also believe Nigeria forex inflows will remain strong, although they warned that geopolitical tensions and global uncertainties could slow the pace of foreign investment.
Do you think stronger foreign exchange inflows will be enough to keep the naira stable in the months ahead?
