Reserves Gain $12.9bn In 1 Year

Reserves Gain $12.9bn In 1 Year

The nation’s foreign exchange buffer added $12.9 billion or nearly 50 per cent in one year amid weekly intervention of the Central Bank of Nigeria (CBN).

The foreign reserves monitored by CBN opened 2017 at $25.84 billion and grew to $38.73 billion as at December 28, 2017.

The foreign exchange had reached its bottom at about $23.6 billion in October 2016 from as high as $40 billion in January 2014.

In September 2008, Nigeria’s foreign exchange reserves hit $62 billion, with federal government spending $12 billion to settle external debts.

CBN governor, Mr. Godwin Emefiele, in November said, “It is my belief that if we remain resolute with our efforts, policies and actions we can attain foreign exchange reserve position of about $40 billion by end 2018”.

Emefiele, in December, disclosed that the nation’s foreign reserves had risen to $38.2 billion, the highest in 39 months. Finance analysts said Nigeria’s foreign reserve ought to have crossed the $40 billion mark in 2017 but impinged by CBN’s creation of special windows to tackle instability in the foreign exchange market.

They believe that this development is renewing confidence that the 2018 foreign reserves target of the CBN put at $40 billion is achievable, as the apex bank steps up its management of foreign exchange earnings.

They noted that steady increase in the global oil prices had contributed to the appreciation recorded in the nation’s foreign reserves, as international trade also impacted on the foreign exchange buffer of the apex bank.

In November 2017, the federal government had raised a total sum of $3 billion through Eurobonds, which was oversubscribed by about $11 billion and split across 10-year and 30-year tranches at issuance yield of 6.5 per cent and 7.625 per cent respectively.

Also, increased inflow from Diaspora remittances is also said to have contributed immensely to Africa’s largest economy foreign reserves.

The breakdown of the latest figure showed that the reserves, in just one month gained total sum of $3.8 billion between November 30, 2017, closing figure of $34.9 billion and December 28, 2017 balance figure of $38.7 billion.

The CBN latest statistics showed that a week earlier, as of December 22, Nigeria’s foreign reserves stood at $37.92 billion, representing 10.1 per cent from a month earlier.

It however stood at $34.53 billion as of November 24, up nearly 3 per cent from a month earlier, with a balance of $33.58 billion at the same date in October, representing 40.5 per cent compared to the balance in the corresponding period in 2016.

Further checks revealed that the nation’s external reserves under the supervision of the CBN recorded a whopping $8 billion between January and October of the year under review.

The figure showed that during the 10 months considered, the foreign reserves increased by 30.9 per cent, with an opening figure of $25.84 before closing at $33.83 billion on October 31, 2017.

There has been steady increase in global oil prices and increased activity in the Investor and Exporter foreign exchange window.