Nigeria's Foreign Reserve Falls by over $500m in Just 6 Days as CBN Battles to Defend Naira's value
- Nigeria's foreign reserve suffered a drop of over $500 million in the first week of September 2023
- This decline in reserves comes amid ongoing efforts by the CBN to help retain naira's value in the foreign exchange market
- The CBN has consistently expressed its intention to defend the naira and maintain its value around a certain exchange rate
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The latest data from the Central Bank of Nigeria shows that Nigeria's foreign reserve is at $33.39 billion as of Wednesday, September 6, 2023.
This represents a $562.6 million drop when compared to the $33.95 billion the reserves closed in the month of August.
Source: Getty Images
The CBN gave the figures in its reserve management data released on its website and obtained by Legit.ng.
Foreign reserves decline
Further analysis of CBN figures shows that the $33.39 billion reserve as of Wednesday indicates that, since President Bola Tinubu came into power, the reserve has dropped by $1.85 billion.
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When Tinubu assumed office, CBN reported that Nigeria's foreign reserve was at $35.25 billion on May 28, 2023.
The reserve in the coming days is also expected to go lower as CBN moves to clear outstanding dollar debts to banks.
Legit.ng, in an earlier report, revealed that Folashodun Shonubi, acting governor of the Central Bank of Nigeria, promised that the apex bank would repay banks all outstanding forward contract debts in the next one to two weeks.
While the CBN did not reveal the actual amount, a recent report by JP Morgan put the total amount of forward contract debt owed by the CBN at $6.84 billion, Punch reports.
CBN faces another headache as Nigeria’s foreign reserves fall to 2-year low
Meanwhile, in another report, Legit.ng revealed that Nigeria's foreign reserve has hit a two-year low.
The data obtained from the CBN showed that Nigeria's reserves at $33 billion were the lowest since 2017.
The foreign reserves are a key firepower for the CBN in its fight to ensure the naira stays strong against other currencies at the foreign exchange market.
Source: Legit.ng
