Portfolio inflows hit $7.09bn in Q2, direct investment lags

LAGOS, Nigeria — Nigeria’s portfolio investment inflows rose 17.6% quarter on quarter to $7.09 billion in the second quarter of 2026, up from $6.03 billion in the first quarter, according to the Central Bank of Nigeria (CBN). The increase of $1.06 billion was driven mainly by higher inflows into long-term government debt securities, the CBN said in its Q2 2026 Economic Report, published on Monday, October 26.

Portfolio inflows were about six times the size of direct investment liabilities in the quarter. Direct investment liabilities rose to $1.15 billion from $1.03 billion, an increase of $120 million or about 11.7%, mainly from higher reinvested earnings.

Other investment liabilities more than doubled to $2.75 billion from $1.36 billion. The CBN linked the rise to larger loan drawdowns by government and other sectors, along with higher currency and deposit liabilities at deposit-taking institutions.

Net incurrence of financial liabilities increased to $10.84 billion from $8.36 billion in the first quarter. Portfolio inflows accounted for about 65% of that total, down from about 72% in the first quarter, because other investment liabilities grew faster.

The rise in portfolio investment came as total foreign exchange inflows fell 4.24% to $30.03 billion from $31.36 billion. Autonomous inflows rose 3.59% to $21.91 billion, while inflows through the CBN fell 20.47% to $8.12 billion.

Nigeria’s financial account recorded net lending of $1.74 billion in the quarter, compared with net borrowing of $2.03 billion in the first quarter. The CBN linked the shift mainly to a higher acquisition of other investment and reserve assets.

External reserves rose to $51.39 billion at the end of June from $48.35 billion at the end of March. The average Nigerian Foreign Exchange Market rate strengthened to ₦1,365.95 per dollar from ₦1,384.48 in the previous quarter.

Net international investment liabilities narrowed to $92.94 billion from $94.68 billion, while total financial liabilities rose by $9.71 billion to $238.66 billion.

The CBN cautioned that portfolio investment and direct investment measure different things and should not be treated as interchangeable. Portfolio inflows, which mostly involve government debt and other securities, can support demand for government securities and foreign exchange liquidity. An increase in them does not necessarily mean equivalent long-term capital formation. The CBN’s balance-of-payments figures are also separate from the National Bureau of Statistics’ capital importation data and should not be read as total capital importation.