Nigeria’s external reserves have reached a 22-month high of $37.31bn, reflecting significant foreign inflows into the country’s economy.
Data from the Central Bank of Nigeria (CBN) revealed that as of September 18, 2024, the reserves hit the highest level since November 4, 2022, when they stood at $37.36bn.
This marks a notable recovery in Nigeria’s foreign currency position.
On a year-to-date basis, the country’s reserves surged by 12.99 per cent, or $4.29bn, from the $33.02bn recorded at the start of the year on January 2, 2024.
Data from the CBN showed that the country recorded $8.86bn in FX inflow in February 2024, higher than $5.66bn in the corresponding period of February 2023.
The CBN’s Economic Report for February 2024 noted that new investments into the economy increased significantly to $1.24bn, compared with $0.33bn in January 2024.
Foreign direct investment inflow rose to $0.06bn, from $0.03bn in the preceding month. Portfolio investment inflow increased to $0.80bn from $0.12bn, following rising returns on money market instruments and bonds. Similarly, other investment capital, mainly loans, rose to $0.37bn, from $0.18bn in the preceding period.
The External Reserves represent the country’s stock of foreign currency and serves as a crucial measure of the country’s ability to meet international financial obligations and stabilise the local currency.. However, they have failed to make a real impact on the falling naira, which was adjudged one of the 10 worst-performing currencies in the world by Bloomberg on September 20.
