NIGERIA’S foreign exchange (FX) reserves fell to $30.329 billion as of May 31, the lowest level since April 18, 2017.
The decline represented a $534.996 million reduction from $30.864 billion recorded as of April 28, 2017 central bank data showed on Friday.
This was after the reserves had landed at $30.49 billion as of May 25, down 0.87 percent from a month to that date.
Year-on-year, the data showed the forex reserves were up 15.27 per cent, even as the impact of the increased FX sales by the Central Bank of Nigeria (CBN) is reflected in the consistently declining reserves from approximately US$31.0billion (5/05/2017) to US$30.3 billion (31/05/2017).
However, experts note that the external reserves still remain above threatening levels and perceived to be somewhat sufficient for the CBN to sustain the interventions.
Africa’s biggest economy shrank by 1.5 per cent in 2016 in its first annual recession in 25 years, hit by a shortage of hard currency and lower revenue from its dominant oil sector as world crude prices remained under pressure.
The central bank has been intervening on the official market to try to narrow the spread between the official interbank and black markets. It has sold over $4 billion since February, but analysts doubt that this pace can be sustained.
Plunging external reserves is stoking doubts over the sustainability of the said dollar interventions by the apex bank.
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