The Central Bank of Nigeria (CBN) has reported that the worth of its gold reserves rose to N2.77 trillion as at 31 December 2024, up from N1.28 trillion recorded on the finish of 2023.
This was disclosed within the apex bank’s audited monetary assertion for the 2024 monetary 12 months.
Though the amount of gold holdings remained unchanged at 687,402 troy ounces, the rise in worth was pushed by a pointy rise in world gold costs.
The CBN valued its gold bullion at a market value of $2,624.39 per ounce as on the finish of 2024, in comparison with $2,062.98 per ounce within the earlier 12 months.
The rise in gold reserves mirrors a broader development globally, as central banks ramped up gold purchases in 2024 amid issues over inflation, foreign money volatility, and financial uncertainty.
International gold demand helps valuation
In accordance with the World Gold Council’s Gold Demand Tendencies report for 2024, world gold demand, together with over-the-counter funding, rose by one per cent to 4,974 tonnes, setting a brand new annual document. Central banks contributed considerably to this demand, buying over 1,000 tonnes for the third consecutive 12 months.
The report famous that the London Bullion Market Affiliation (LBMA) gold value averaged $2,386 per ounce in 2024, marking a 23% enhance from 2023. Within the fourth quarter alone, the common value rose to $2,663 per ounce, contributing to a surge out there worth of central banks’ gold holdings.
The overall worth of worldwide gold demand reached an all-time excessive of $382 billion in 2024, reflecting the mixed affect of upper costs and sustained shopping for throughout totally different sectors.
CBN strengthens reserve portfolio
The CBN’s audited accounts additionally confirmed that Nigeria’s complete exterior reserves grew to N54.73 trillion on the finish of 2024, up from N29.98 trillion recorded in 2023.
Gold reserves accounted for about 5.1% of the entire exterior reserves, in comparison with about 4.3 per cent within the earlier 12 months.
The CBN’s elevated reliance on gold alerts a deliberate diversification away from conventional foreign money reserves, offering a hedge towards greenback volatility and world monetary dangers.
With projections indicating that central banks might proceed to build up gold in 2025, Nigeria’s place seems aligned with a broader world development in direction of securing reserve belongings in tangible, inflation-resistant varieties.
What you need to know
As of December 31, 2024, Nigeria’s internet overseas alternate reserves stood at $23.11 billion, marking the very best stage recorded in over three years.
This represents a pointy restoration in comparison with $3.99 billion on the finish of 2023, $8.19 billion in 2022, and $14.59 billion in 2021.
- Along with the advance in internet reserves, the nation’s gross exterior reserves additionally rose to $40.19 billion by the top of 2024, up from $33.22 billion on the shut of the earlier 12 months.
- The rise in Nigeria’s reserves has been attributed to a number of key elements. One main contributor was the Central Bank of Nigeria’s choice to scale back publicity to short-term overseas alternate obligations, together with swaps and ahead contracts, which beforehand weighed closely on the web reserve place.
- There was additionally a notable uptick in overseas alternate inflows from non-oil sectors, serving to to strengthen the reserve base and scale back reliance on oil earnings.
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