CBN Reports $1.3bn Inflow In Feb. As Remittances Quadruple, Foreign Investors’ Return

The Central Bank of Nigeria (CBN) on Thursday reported a significant increase in foreign exchange inflow into the economy in February 2024, amid increments in remittance payments by Nigerians overseas and purchases of Naira assets by foreign portfolio investors.

Addressing newsmen in Abuja, the CBN’s Acting Director of Corporate Communications, Mrs. Hakama Sidi Ali said, “the bank’s data indicates that overseas remittances rose to US$1.3bn in February 2024, over four times the US$300m received in January.

According to her, “foreign investors purchased more than US$1bn of Nigerian assets last month, with total portfolio flows of at least US$2.3bn recorded thus far in 2024 compared to US$ 3.9bn seen in total for last year.”

She said higher FX inflows continued in March 2024, driven by increased investor interest in short-term sovereign debt following the recent adjustment to benchmark interest rates. She noted that Government securities issuances had been significantly oversubscribed, with foreign investors accounting for over 75% of bids received at the auctions conducted on March 1 and 6, 2024.

A statement by the CBN recalled that the Governor, Olayemi Cardoso set out a detailed strategy to curb inflation, stabilise the exchange rate, and spur confidence in the banking system and economy, using last month’s Monetary Policy Committee meeting and a conference call with foreign portfolio investors to set expectations for sustained increases in Nigeria’s foreign currency reserves and improved liquidity in the foreign exchange market.

“All the different measures we have taken to boost reserves and create more liquidity in the markets have started to pay off,” Governor Cardoso said.

“When people understand the real issues and see a strategy and a plan, things tend to calm down. Our objective today is to ensure that the market has supply, that the market functions, and that investors can come in and go out,” he noted.