Fitch Ratings has projected that Nigeria’s ex- ternal reserves will decline to $47 billion by the end of 2026, despite ongoing foreign exchange (FX) reforms and recent improvements in macroeconomic policy.
In its latest assessment affirming Nigeria’s long-term foreign-currency issuer default rating at ‘B’ with a stable outlook, the rating agency said the expected moderation reflects rising fiscal pressures and external risks.
Fitch noted that gross external reserves rose to $49.4 billion at the end of March 2026, up from about $32 billion in April 2024, supported by recent policy adjustments in the foreign exchange market.
However, it said the gains may not be fully sustained.
“We forecast a marginal decline to $47 billion at end-2026, reflecting higher spending pressures and external risks,” the agency said.
The projection comes amid continued reforms by the Central Bank of Nigeria (CBN) aimed at stabilising the foreign exchange market, including measures to ease restrictions on the repatriation of oil export proceeds by international oil companies.
Fitch said the reforms have supported “gradual normalisation in the FX market” and improved investor confidence, but warned that structural weaknesses continue to weigh on the economy.
The agency said Nigeria’s rating reflects “a large economy, a relatively developed domestic debt market, large oil and gas reserves and an improved monetary and exchange rate policy framework”.
However, the agency added that the country remains constrained by weak governance indicators, high inflation, security challenges, heavy reliance on hydrocarbons and persistently low revenue generation.
The foreign exchange reserves reached its highest level in 17 years on March 11, when it hit $50,02 billion, but the external reserves stand at $48.80 billion as of April 10.
Fitch also warned that fiscal pressures are expected to intensify, projecting that Nigeria’s budget deficit could widen to nearly 5 percent of GDP in 2026.
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