Nigeria’s external reserves declined by $4.47bn from $42.54bn as at the beginning of 2019 to $38.07bn, at the end of December. This represents a 10.5 per cent decline.
Foreign exchange reserves are assets held on reserve by a monetary authority in foreign currencies. The country’s external reserves have been on a decline owing to the drop in oil receipts and the intervention of the Central Bank Nigeria in the foreign exchange market.
Data obtained from the CBN showed that the country’s external reserves recorded a marginal increase from $42.54bn to $44.79bn in the first quarter. However, in the second quarter, it dropped marginally by $50m from $44.79bn to $44.74bn.
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During the third quarter, the reserve dipped further by $3.85bn from $44.74bn to $40.89bn while in the fourth quarter the reserve continued to show signs of weakness as it dropped further by $2.82bn from the third quarter figure of $40.89bn to $38.07bn.
CBN Governor, Mr Godwin Emefiele, had last week said the reserves was being used by the apex bank to meet the country’s obligations adding that the level of fluctuations was not unusual.
He said despite the dwindling level of the country’s foreign reserves, there was no possibility that the apex bank would devalue the naira.
He said that with crude oil selling at a price of about $63 to a per barrel, the drop in reserves to less than $40bn was not enough reason for panic.
