Nigeria’s foreign reserve increased by $674.4 million last month, the Central Bank of Nigeria has revealed.
The latest figure extracted by Ripples Nigeria from the CBN’s daily external reserve tracker, revealed that Nigeria’s foreign reserves rose from $38.48 billion at the start of June to $39.1 billion at the end of the month.
Foreign reserves are assets held on reserve used by a country’s central bank to back liabilities and influence monetary policy.
They include foreign banknotes, deposits, bonds, treasury bills and other foreign government securities.
These assets serve many purposes but are most significantly held to ensure that a government or its agency has backup funds if their national currency rapidly declines.
The last time Nigeria’s reserves reached the $39 billion mark was May 13, when it stood at $39.01 billion.
At the last Monetary Policy Committee (MPC) meeting held in May, CBN attributed the low foreign reserves in previous months to the high cost of importation of refined petroleum products.
A member of the committee, Adenikinju Adeola Festus, had during the meeting expressed fear that the low reserves would put the Nigerian economy in a difficult position.
He said: “I am worried that Nigeria is not able to benefit maximally from the current upsides in the global oil market.
“We were not only unable to ramp up our production levels to meet the OPEC quota, no accretion to foreign reserves is also taking place, and government deficit and public debts are going north at a time we should be writing down our debt profiles and even building up a buffer for the inevitable raining days ahead.”
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