Naira Rises as Remittances Hit 5-Year Peak

The naira gained value against the US dollar on Thursday, April 10, 2025, marking a strong rebound in the official foreign exchange market after a series of declines. The local currency appreciated to N1,630.50 per dollar, improving from N1,644 the day before.

This improvement coincided with a report by the Central Bank of Nigeria (CBN) showing that personal remittances into the country surged to $20.98 billion in 2024. This is the highest inflow recorded in the past five years, with the previous peak being $23.8 billion in 2019.

Despite the official market gains, the naira experienced a slight dip in the parallel market, falling to N1,615 from N1,600 per dollar. However, the exchange rate gap between the official and parallel markets narrowed significantly, reducing from N44 to N15.

CBN Governor Olayemi Cardoso attributed the jump in remittances to several economic reforms and enhanced engagement with Nigerians in the diaspora. According to him, average monthly remittance inflows climbed from $250 million at the beginning of 2024 to $600 million by September of the same year. He noted that these improvements have led to increased trust in the remittance platforms and a preference for official channels by Nigerians abroad.

The report further revealed that inflows through International Money Transfer Operators rose by 43.5%, reaching $4.73 billion, up from $3.3 billion in 2023. Nigeria’s remittance levels also remain the highest in Africa. In comparison, Ghana received $2.43 billion in 2023, while South Africa registered $803.3 million.

In addition to rising remittances, Nigeria also saw an increase in net acquisition of financial assets, which rose to $12.12 billion in 2024. Portfolio investments surged by 106.5% to $13.35 billion, and resident foreign currency holdings rose by $5.41 billion, signaling growing confidence in the economy. However, foreign direct investment dropped slightly by 2.3% to $1.08 billion.

Cardoso emphasized that ongoing macroeconomic stabilization and regulatory reforms are positioning Nigeria for a stronger economic future. He also stated the CBN’s intention to build closer ties with diaspora communities in the Middle East to boost future remittance flows and enhance financial system resilience.

Meanwhile, JP Morgan has maintained a positive outlook on Nigeria’s economic prospects. The global investment bank noted that recent changes in leadership at the Nigerian National Petroleum Company Limited and the release of net foreign exchange reserve figures are helping to stabilize the market and bolster investor confidence.