Godwin Emefiele, Governor of Central Bank of Nigeria,
Nigeria’s external reserve climbs by $5.15bn
Nigeria’s external reserve rose by $5.15 billion in 2021 to close at $40.52 billion as of 31st December 2021, representing a 14.5% rise compared to $35.37 billion recorded as of the end of the previous year.
According to data obtained from the daily tracker of the Central Bank of Nigeria (CBN), the gain recorded in the country’s reserve level is majorly attributed to the $4 billion Eurobond, secured by the federal government in September, which saw the reserve surpass $41 billion in October 2021.
Nigeria also secured a $3.35 billion International Monetary Fund (IMF) credit under the Special Drawing Rights in the review year, which also served as a boost for the reserves.
The external reserve has been a major buffer for the CBN in shoring up the country’s exchange rate, by intervening in the official Investors and Exporters window.
Notably, over $32 billion in FX exchanged hands in the review year, largely due to the Central Bank’s significant intervention into the market, after placing a ban on the sales of FX to BDC operators in the country.
The nation’s foreign reserve had gained $5.99 billion in October, however, in November, it lost $611.01 million in value as against the previous month gain and a $2.76 million gain in September 2021. In December 2021, the reserve dipped by $66.17 million, putting the annual gain at $5.15 billion.
Nigeria’s reserve has declined in recent months as the CBN continues to intervene in the official forex market in order to stabilise the local currency. Especially, at a time when the naira is highly volatile at the black market.
