CBN struggles to save Naira as External reserves lost $610m

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The external reserves of Nigeria reportedly fell by $610m last month (November). This was disclosed on Thursday by the Central Bank of Nigeria, noting that the reserves dropped to N$41.22bn as of November 29 from $41.83bn on October 29.

The CBN affirmed that at the present level, the external reserves could meet the country’s nine-month import demand.

The Governor, CBN, Godwin Emefiele, said, at the Chartered Institute of Bankers of Nigeria’s dinner in Lagos, said, “Supported by our demand management policy, in addition to support from the successful issuance of the $4bn Eurobond and the IMF SDR, our external reserves today stands at over $41.4bn, which is enough to support nine months of imports.

“This is not just a morale booster for both foreign direct and portfolio investors willing to invest in the economy, but it provides significant fire power to support our domestic industries that need to import critical machines and equipment for domestic production and exports.”

Emefiele said supply was also affected by massive outflow of foreign portfolio investments from emerging and frontier markets, including Nigeria in 2020.

“A combination of these factors led to a marked drop in our foreign reserves from nearly $36.7bn at the beginning of the crises in March said to a low of $32.9bn in June 2021,” he said.