The Central Bank of Nigeria’s data has shown that the nation’s foreign reserves has dropped to $30.25 billion by June 28.
The reserves showed a 14.8 per cent rise from a year ago, when they stood at $26.34 billion. The dollar reserves have risen slightly this year, thanks to the rise in global oil prices.
The Organisation of Petroleum Exporting Countries (OPEC) member country has added $4.2 billion to its reserves since the beginning of the year. Foreign reserves stood at $26.09 billion at the beginning of the year.
The foreign exchange reserves rose by $7 billion in six months to hit $31 billion at the end of April. According to FBN Capital Research, the reserves rose after the disbursement of $600 million by the African Development Bank (AfDB) last November and the recent sale of N1.5 million Eurobond.
“There has also been a significant recovery in oil production over the period. With less certainty we can speculate about improved forex management and possible swap transactions,” it said.
The research firm said the positive surprise was due to the upward swing in reserves, since the CBN stepped up its forex sales in early March.
“The steady accumulation makes it less, not more, likely to adopt the forex reforms sought by the market. There is no sign that the CBN plans to slow its sales, which for wholesale transactions alone are close to $3 billion: rather, it launched its latest window (for investors and exporters) only last month,” the report said.
It said the macro-economic damage from the latest period of oil price weakness, which is approaching three years, could have been manageable if a fiscal buffer against external shocks had been functioning.
The CBN also sold N31.94 billion ($104.76 million) in treasury bills last Friday in a bid to tighten liquidity in the money market, while overnight lending rate fell.
Traders said the bank sold N31.52 billion of 349-day treasury bill at 18.59 per cent and N440 million naira of 160-day treasury bill at 17.98 per cent at an auction last Friday.