Nigeria entered May nursing a bruised reserves position. It ended the month with one of the strongest single-month recoveries of the year and a trajectory that puts the $50 billion mark firmly back in sight.

Nigeria's gross external reserves climbed to $49.26 billion by the end of May 2026, rising $900 million from $48.36 billion recorded at the end of April, a 1.86% month-on-month increase that reversed a prolonged period of pressure and moved the country closer to the psychologically significant $50 billion threshold. The latest available CBN data places reserves at $49.58 billion, reflecting continued accumulation in the final days of the month.

The May rebound is a direct reversal of April's deterioration. Reserves opened in April at $49.18 billion before declining steadily to $48.94 billion by April 7, weakening further to $48.63 billion by April 17, and settling at $48.36 billion at the end of the month, a cumulative April loss driven by external debt repayments, FX market interventions, and broader global economic pressures linked to the Middle East conflict.

The naira reflected the improved reserves backdrop, closing May at ₦1,373.25/$ compared with ₦1,376/$ at the end of April, a marginal but symbolically important appreciation that confirms the correlation between reserve strength and exchange rate stability.

The year-long trajectory behind May's milestone is equally striking. As of February 16, 2026, gross external reserves had reached $50.45 billion, their highest level since 2018. Net reserves climbed from $3.99 billion at the end of 2023 to $34.80 billion at the close of 2025, with the 2025 net reserve position alone exceeding the total gross reserves recorded at end-2023.

CBN Governor Olayemi Cardoso underscored the significance of the May reserve level at the most recent MPC press briefing. "Gross external reserves remained robust at $49.49 billion as of May 15, 2026, compared with $48.35 billion at the end of March 2026, sufficient to cover 9.04 months of imports for goods and services. This strong buffer continues to reinforce investor confidence in the Nigerian economy and support exchange rate stability," Cardoso stated.

The drivers sustaining the reserves build-up are well established. Analysts attribute the broader improvement to a combination of oil-related inflows, diaspora remittances, foreign portfolio investment, and the CBN's ongoing FX market reforms, which have improved transparency and reduced the speculative pressure that historically inflated demand in the parallel market.

The CBN has projected that reserves could reach $51 billion by the end of 2026 as part of its macroeconomic stabilisation strategy, a target that, with $49.58 billion already on the books and six months of the year remaining, looks increasingly attainable. The harder question is sustainability: whether the structural reforms underpinning the recovery are deep enough to hold the gains if global oil prices soften or the Middle East crisis escalates further.

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