Nigeria’s FX Reserves Drop by $1.02B Amid CBN’ Naira Defence

Nigeria’s FX Reserves Drop by $1.02B Amid CBN’ Naira Defence

Nigeria’s foreign exchange reserves have dropped by $1.02 billion over the last 18 days, as the CBN continues its aggressive defence of the naira. As of April 4, 2024, the reserves stood at $33.43 billion, down from $34.45 billion on March 18, according to CBN data.

The decline comes as the CBN continues to intervene in the foreign exchange market to support the naira.

The report revealed that Nigeria’s foreign exchange reserve plummeted to its lowest level since February 20, 2024, when it was $33.42 billion. This marks a decisive end to a period of steady accrual, during which the reserve witnessed a 43-day surge, accruing $1.28 billion between February 5 and March 18, 2024. The CBN earlier attributed the rise to increased remittance payments from Nigerians abroad and heightened interest from foreign investors in local assets, including government debt securities. The apex bank also noted that the increase was due to reforms in the foreign exchange market and an increase in oil production amongst others.

According to the report, the downward trend reflects a significant drawdown in the reserves, which have been depleting since March 18, when they peaked at $34.45 billion. The reserves dropped to $34.39 billion on March 19 and continued to fall steadily, hitting $33.57 billion by April 2, and further sliding to $33.43 billion by April 4. This marks a decline of $1.02 billion within 18 days, indicating the pressure on the reserves amid ongoing efforts to stabilize the local currency.