Nigeria's External Reserves to Drop to $47bn by 2026

Fitch Ratings has disclosed that Nigeria's external reserves are expected to decline to $47 billion by the end of 2026, despite ongoing reforms aimed at stabilizing the economy. The agency affirmed Nigeria's long-term foreign currency issuer default rating (IDR) at 'B' with a stable outlook.

Fitch noted that while Nigeria has a large economy and a liquid domestic debt market, it faces significant fiscal pressures and external vulnerabilities that could lead to modest currency depreciation in the near term. As of mid-April 2024, Nigeria's gross foreign exchange reserves rose to $49.4 billion but later declined to $48.85 billion by April 9, 2026.

Fitch expects the budget deficit to widen to nearly 5% of GDP in 2026, with revenue projected to rise modestly to 11% of GDP. The agency also highlighted persistent inflation and weak revenue mobilization as challenges, maintaining a cautious stance on Nigeria's credit outlook despite ongoing reforms.