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Nigeria’s external reserve reached a new milestone in June, climbing to $34.07 billion. This is the highest amount since March 2024.
This data is from the Central Bank’s reserve position as of June 26, 2024.
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Last week, Newslodge reported that the reserves hit a three-month high at $33.5 billion.
Since then, the reserves have continued to grow, surpassing $34 billion for the first time since March 21, when it was $34.2 billion. The reserves have increased by a substantial $1.3 billion since June.
However, the reasons for this growth are not clear.
What This Means
The rise in reserves comes after three months of ups and downs when it dropped to $32.11 billion on April 19, 2024. This caused worries about Nigeria’s financial stability.
In April, the central bank Governor had to talk about this issue at the last IMF Spring meeting.
Since then, the reserves have been growing slowly but surely. The exchange rate has also been steady, averaging N1,481/$1 this month.
What You Should Know
The Monetary Policy Committee (MPC) recently asked the Central Bank of Nigeria (CBN) to increase the external reserves. The CBN is working on this.
To keep foreign exchange coming into the country and strengthen the reserves, the CBN plans to double the money sent home by Nigerians abroad this year.
Additionally, the Afrexim Bank recently released $925 million as part of a $3.3 billion loan agreement with the NNPC. This money helps stabilize the forex market during times of change.
The World Bank approved $2.25 billion in loans to Nigeria to support its economy and vulnerable populations. This money aims to provide quick financial and technical support for Nigeria’s economic stability efforts.
Earlier this week, CBN Governor Yemi Cardoso said the country received about $24 billion in foreign exchange in the first quarter of 2024. This amount is the highest in any quarter since 2021. The CBN also set up a committee to encourage more money sent home by Nigerians abroad into the official forex market.
The rise in foreign exchange is expected to further boost Nigeria’s external reserves, which have been steadily increasing.
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