There are many reasons to believe that the country's economy may face more difficult times in the future.
This is despite the fact that during the last four months, the nation's foreign exchange reserves have decreased by $1.82 billion.
Since the start of this year, the foreign exchange reserves have continuously decreased.
According to information obtained, the foreign exchange reserves decreased by $47.83 million last week, ending the four-month period at $35.36 billion rather than the $37.08 billion they had reached at the end of 2022.
The lowest point in recent months was the closing position in April 2023.
However, because economic analysts believe that the downward trend may last for some time, the situation has given Nigerians cause for concern about tougher times ahead.
A member of the Presidential Economic Advisory Council (PEAC) and the managing director of Financial Derivatives Company (FDC), Bismarck Rewane, responded to the situation by describing the outlook for the country's foreign exchange reserves as unfavorable.
According to analysts at Cordros Capital, "FPIs who have historically supported supply levels in the Investors & Exporters Window will be needed to sustain forex liquidity levels in the medium to long term" given low crude oil production and high premium motor spirit (PMS) under-recovery costs.
Given an ambiguous framework for foreign exchange, a drab macrostory, high rates around the world, and increased global uncertainties.
"While we think a new administration would provide the country a respite in the near term because attitudes are expected to improve, we anticipate foreign capital inflows will remain low compared to pre-COVID levels over the medium term in the absence of meaningful reforms in the currency, fiscal, and regulatory and frameworks for monetary policy.
The prominence of capital controls to manage the ongoing forex crisis complicates fund repatriation from Nigeria and, by extension, discourages new investments by offshore players, according to experts from Afrinvest (West Africa), who also claim that the existence of multiple forex windows muddles clarity around forex administration.