In a major economic forecast, the Central Bank of Nigeria (CBN) has projected that the nation’s external reserves will rise to $51.04 billion by the end of 2026. This marks a significant climb from the projected $45.01 billion for 2025 and signals continued strengthening from current levels.
The projection was detailed in the CBN’s Macroeconomic Outlook for Nigeria, 2026 report, titled ‘Consolidating Macroeconomic Stability Amid Global Uncertainty,’ released on Tuesday.
Drivers of Growth
The apex bank attributed the expected accretion to several key factors:
· Increased Oil Earnings: Anticipated rises in crude oil production and stable global prices are set to boost dollar inflows.
· Sovereign Bond Issuance: Planned issuances of foreign-currency denominated bonds are expected to attract foreign capital.
· Diaspora Remittances: Sustained inflows from Nigerians living abroad will continue to support the reserves.
· Dangote Refinery Impact: The expansion of the Dangote Refinery’s capacity is highlighted as a critical medium-term support, as it will drastically reduce the foreign exchange demand for imported fuel.
Linked Benefits: Inflation and FX Stability
The report ties the reserves growth to broader macroeconomic stability. The CBN anticipates that reduced pressure in the foreign exchange market will narrow the gap between official and parallel market rates.
Furthermore, this stability is expected to help drive inflation down to 12.94% in 2026, a continued deceleration from the 21.26% estimated for 2025. The bank cited expected declines in food and energy prices, improved agricultural output, and the lagged effects of its monetary policy as contributing factors.
Cautious Optimism Amid Risks
While the outlook is positive, the CBN cautioned that risks remain. The fiscal outlook is vulnerable to a potential decline in global oil prices or domestic production shortfalls. The bank also expressed concern over rising non-performing loans in the banking sector, warning that they could threaten profitability and credit availability if not managed.
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