Foreign reserves gain $70m in one week

Nigeria’s foreign reserves increased by $70 million from $35.59 billion to $35.66 billion in the one week period between 20th and 27th August, data from the Central Bank of Nigeria (CBN) website revealed on Monday.

The reserves had fallen by $278.91 million from $35.87 billion on 29th July to $35.59 billion on 19th August.

The CBN economic report for April noted that the country’s international reserves climbed from $33.69 billion as of the end of March to $36.46 billion in the corresponding period of April, reflecting the receipt of the International Monetary Fund’s $3.4 billion Rapid Financing Facility.

It demonstrated that the import cover level (like the value of gross international reserves, compared to the value of merchandise imports and services payment) rose from 3.8 months in March to 4 months in April, above the IMF threshold of three months.

Read also: Nigeria’s foreign reserves shed $454m in 6 weeks

At its last Monetary Policy Committee (MPC) meeting, the CBN observed that the country’s exchange rate was still susceptible to the volatility of crude oil prices.

The volatility, it said, would continue to impact Nigeria’s macroeconomic aggregates. The aggregates, according to the MPC, comprised exchange rate development, domestic revenue, foreign exchange earnings, external reserves, price formation, capital inflows and balance of payment position.

It said the effects of the continued lockdown of major economies and restrictions on travel and trade would be felt by the economy continuously through the short supply of essential imports, inflationary pressure through high import prices and exchange rate depreciation as well as impact of prolonged uncertainties and volatility of the oil market on the macroeconomic stability.

The CBN has lately made moves to boost the country’s bullion reserves with 12.5 kilogrammes of gold produced locally by artisanal miners in accordance with London Bullion Market Association standards.

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