Amid currency pressures, Nigeria’s net forex inflow surges by $17bn
By Seun Ibiyemi
In the second quarter of 2024, Nigeria saw a major increase in its net foreign exchange (forex) inflows, recording a boost of $17.18 billion—a 49.39 percent rise from $11.50 billion in the previous quarter.
This improvement in forex inflows comes as Nigeria faces persistent currency challenges.
Data from the Central Bank of Nigeria (CBN) shows that total forex inflows reached $24.55 billion in Q2 2024, up from $22.26 billion in Q1, primarily driven by autonomous sources. Autonomous channels, including remittances and private capital inflows, rose from $14.17 billion to $16.12 billion during this period.
Forex inflows via the CBN also saw a slight increase, moving from $8.09 billion in Q1 to $8.43 billion in Q2, reflecting the central bank’s efforts to stabilise the forex market.
Additionally, Nigeria experienced a sharp decrease in forex outflows, dropping 31.51 percent from $10.77 billion in Q1 to $7.37 billion in Q2.
This reduction was largely driven by a 36.06% drop in outflows through the CBN, from $8.92 billion to $5.71 billion. Outflows from autonomous sources also decreased, falling 8.79 percent to $1.66 billion.
As a result, net forex inflows surged by 49.39 percent to $17.18 billion in Q2, with autonomous sources contributing $14.46 billion.
The CBN reversed its position, achieving a net inflow of $2.72 billion in Q2 after recording a net outflow in Q1.
Despite the positive inflow trend, Nigeria’s currency continues to depreciate. The average exchange rate in the Nigerian Foreign Exchange Market fell by 5.86% to N1,385.96 per dollar in Q2, compared to N1,304.72 in Q1.
Since the end of Q2, the official exchange rate has approached N1,650 per dollar, while the parallel market rate hovers around N1,750 per dollar.
Analysts attribute this continued depreciation to heightened demand and supply constraints, particularly in the retail forex market, which have intensified price pressures despite the increase in net forex inflows.
