External reserves gain $203m, CBN boosts forex supply

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The nation’s foreign exchange reserves increased by $203.2m in the six days to Wednesday, the latest data from the Central Bank of Nigeria showed on Thursday.

The reserves, which stood at $47,425bn on June 7, 2018, rose to $47.627bn on June 13, after increasing for the first time in more than two weeks on June 8.

The external reserves had been declining since May 21, when it stood at $47.754bn, down from $47.799bn on May 18.

The Head of Research, FSDH Merchant Bank, Mr. Ayodele Akinwunmi, said last week that the pressure on demand from foreign investors was mainly responsible for the low growth in the external reserves.

He said, “Our analysis between August 2017 and May 2018 shows that Nigeria recorded the lowest foreign exchange inflows through the I&E Window in May 2018. FSDH Research expects the positive domestic and external environment to further lead to external reserves accretion in the short-term and this development should provide further stability for the foreign exchange rate.”

Meanwhile, the Central Bank of Nigeria has disbursed $343.06m to the retail Secondary Market Intervention Sales following its intervention in the foreign exchange market on Thursday.

Figures obtained from the CBN indicated that the amount released was for requests in the agricultural, airlines, petroleum products and raw materials, and machinery sectors.

The Acting Director, Corporate Communications, CBN, Isaac Okorafor, said in a statement that the continued interventions of the bank were in line with the assurances made by the Governor, Godwin Emefiele, to sustain market liquidity in order to boost production and trade as well as maintain stability in the forex market.

Okorafor reiterated the commitment of the CBN to ensuring that all the sectors enjoy access to forex required for business concerns, saying the bank had, on Tuesday, injected $210m into the wholesale segment of the interbank forex market.

Source: punch


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