Nigeria’s external reserves increased by 0.061% in one day

NIGERIA’S external reserves increased by 0.061 per cent on Thursday, July 14, 2022 to stand at $39.430 billion from $39.423 billion recorded as of the previous day representing a $6,883,926 increase.

This represents the 25th straight day of improvement for the nation’s foreign reserve.

The external reserve had been on a downward trend due to the continuous intervention by the Central Bank in the FX market in order to ensure the stability of the local currency. However, elevated crude oil prices have seen the reserve level improve.

Meanwhile, the World Bank recently disclosed that Nigeria’s external reserves are expected to decline as the Central Bank of Nigeria (CBN) is expected to clear $1.7 billion worth of FX backlog and FX forward contracts to foreigners by the end-October 2022.

This was disclosed by the World bank in a document titled, ‘Nigeria Development Update (June 2022): The Continuing Urgency of Business Unusual.’

Nigeria’s external reserves had been on a downward trend due to the continuous intervention by the Central Bank in the FX market in order to ensure the stability of the local currency.

The World Bank said, “Boosted by higher oil exports, International Monetary Fund’s Special Drawing Rights allocation in August 2021, and a Eurobond issuance in September 2021, gross official reserves rose to $41.3 billion (7.4 months of imports) at the end of 2021, offering an opportunity for exchange rate adjustment.”

“Nigeria issued additional Eurobonds for $1.25 billion in March 2022. However, gross FX reserves are projected to decline during 2022, as the CBN is expected to clear the FX backlog to foreigners (estimated at $1.7 billion as of end-October) and FX forward contracts,” the Bank added.