External reserves rise by $734m in one week

Nigeria’s external reserves expanded by $732.656 million or 2.1% in the one week period between 21^st to 28^th May 2020, data published by the Central Bank of Nigeria (CBN) on Monday have revealed.

In between the periods, the international reserves grew from $35.765 billion to $36.499 billion, marking the fourth straight week it would rise in a row.

Nigeria’s external reserves have maintained an upward trend since the end of April when the International Monetary Fund disbursed a credit facility of $3.46 billion to the country under its Rapid Finance Instrument Facility “to meet the urgent balance of payment needs stemming from the outbreak of the COVID-19.”

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The reserves, which contracted by $11.75 billion or 26% within ten months from 10th June 2019 when the balance was $45.175 billion, began an upward trend from $33.427 billion on 29th April.

Between then and 28th May, it posted a $3.072 billion appreciation translating to 9.1% growth.

Africa’s largest economy has in recent months seen a substantial plunge in crude oil receipts, which account for around 90% of its foreign exchange earnings and roughly 60% of government’s revenue on account of record oil crash at the international market.

Finance Minister Zainab Ahmed on 21st May projected the oil-dependent economy would shrink by 8.9% this year in a worst case scenario without stimulus.

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