The Pacesetter Frontier Magazine

Tag: external reserve

  • Nigeria’s external reserves loses $180m in two weeks

     

    The country’s external reserves lost $180m in two weeks, the latest figures obtained from the Central Bank of Nigeria showed on Sunday.

     

    According to the figures, the reserves, which stood at $33.28bn on July 1, dropped to $33.09bn as of July 12 before gaining slightly to rise to $33.1bn on July 15.

    The reserves lost $905.5m in June, after it fell to $33.32bn at the end of June 30 from $34.23bn on May 31.

     

    The reserves stood at $34.88bn at the end of April 30, according to the CBN.

     

    A member of the Monetary Policy Committee, Adeola Adenikinju, said at the last meeting that as a country, the excessive dependence on oil for revenue and foreign exchange sustenance was no longer tenable in the medium and long term.

     

    He said, “We need to diversify the economic and revenue base of the economy to reduce our exposure to external shocks as well as prepare the economy for the global shift from fossil fuel to green economy.

     

    “It should not be business as usual for our economic managers. The economy also needs  a strong buffer to mitigate external volatility.”

     

     

     

     

     

     

    Source: punchng.com

  • Nigeria’s external reserves has shrunk by $522,525,964 in 16 days.

    According to recent figures on the Central Bank of Nigeria’s (CBN) website, on March 1, 2021 the external reserve was $34,998,144,389 but by March 16, it had shrunk to $34,475,618,425.

     

    Since January 25, 2021 when the reserve stood at $36,469,940,426.08 it has been on a steady decline to the current $34,475,618,425. In other words, between January 25 and March 16, the external reserves declining declined by $1,994,322,001. That is a little shy of $2billion.

     

    The CBN had recently stated that Nigeria’s external reserve at $35bilion was sufficient to finance the country’s seven months’ imports.

     

    The rapid drop in Nigeria’s external reserve coincides with a steady rise in the price of crude oil sales which check recently rose to $71 per barrel within the same period.

     

    Some reasons have been preferred for the sharp drop in external reserves. These include, the CBN’s intervention in the forex market to stabilize the exchange rate, and low foreign inflows.

     

    It is believed that the drop in the country’s external reserve can be linked to shortages in the supply of foreign exchange brought on by a decline in the flow of forex into the country.

     

    In addition receipts from the sale of crude oil take a while before they hit government accounts.

     

    In recent times, forex inflows from International Money Transfer Operators (IMTOs) has whittled down, export proceeds have reduced drastically and flow from the the I and E window have declined as well. All these have prompted reactions from the CBN to change the volume of accretion into the external reserve positively.

     

    Between January and March, many debt obligations matured thus prompting the CBN to make pay out for mature Euro bonds and promissory notes.

     

    The apex bank also engaged in FX swap with international and local dealers a development which would have compelled the CBN to pay off matured obligations as expected of a sovereign.

     

     

     

     

    Source: www.thenationonlineng.net