Skip to main content

BOOM: Nigeria’s External Reserves Drops To Lowest In 11 Years

Nigeria’s foreign exchange reserve fell to $25,780,765,483 (25.78 billion) as of August 16, the lowest we have seen since 2005. The drop was down 2.11% from a month ago.
The Nations external reserves dropped below $26 billion for the first time on the 5th of August 2016 after it closed at about $25,971,610,949. In fact, the external reserves has dropped by about $480 million dollars in August alone compared to just $100 million in the whole of July.
Ironically, the current balance of $25.9 billion is worth about 80% more than what it was in Naira following the depreciation of the naira after it was floated.
The CBN has in the past few days ramped up sales of dollars at the interbank in the hope that it will create liquidity in a market that is yawning gape to swallow forex after nearly almost two years of intense rationing by the CBN.
The Naira weakened to its lowest ever at the interbank after it closed at about N362.5/$1 in midday trading. The Naira will eventually close at about N325 according to data from the CBN.
Analysts believe the external reserves could be headed to below $20 dollars by the end of the year if the prediction by the Petroleum Minister, Dr. Ibe Kachikwu ,that Nigeria will produce about 1.5mbp provided bombing continue in the creeks, comes to pass.
Nigeria is thought to require about $7 billion dollars monthly to fund its imports suggesting that the current external reserves can probably last for just about 4 months. Economist believe that a country’s external reserve position should at least be adequate to fund about 6 months of imports. Nigeria’s total import bill was valued at an averaged of about $75 billion annually between 2010 and 2015 or $6.2 billion a month.
Join our BBM channel for instant updates : C0030863D

Comments

Post a Comment

Popular posts from this blog

Emefiele gives insight, on what to Expect during his second term

The newly re-appointed Governor of the Central Bank of Nigeria, Godwin Emefiele, over the weekend enumerated the things intends to accomplish during his second term in office. Emefiele enumerated his plans while speaking to journalists at the University of Nigeria Nsukka (UNN), on the sidelines of the institution’s Special Convocation which took place on Friday. The CBN Governor gave delivered a lecture at the event. Driving down inflation: According to Emefiele, he intends to focus on policies that would drive down the country’s inflation rate, improve price stability, and drive economic growth. Emefiele’s Stern Warning: The CBN Governor further disclosed that he plans to work with his team to drive down imports and encourage exports. He also used the occasion to issue a stern warning to those who meddle with policies aimed at achieving economic stability, telling them that they will be caught and punished by law. Mr Emefiele’s second term plans came just a few days after ...
Post a Comment
Read more

Gas Alone Cannot Achieve increase in Power Sector – Fashola

The Minister of Power, Works and Housing, Babatunde Fashola , on Thursday said in Lagos that gas alone could not bring the much needed increase in power supply in the country. Fashola spoke as guest speaker through Chinedu Ugbo , acting Chairman, Niger Delta Power Holding Company (NDPHC), at the 2016 Annual Conference of the National Association of Energy Correspondents in Lagos. The News Agency of Nigeria (NAN) reports that the theme of the conference is entitled: “Low oil price: Impact and the way forward” . Fashola said, “It is not gas alone that will allow us to achieve incremental power”. “It is our most reliable source of power, yes, but it is only one solution among many other underutilised solutions. Mambila Power Station, for example, is likely to be our most defining in the road to incremental power, situated in Taraba State. It will potentially add 3,000MW to the grid and yet this is a hydro-electric project, not gas. Our ministry has recently publicis...
Post a Comment
Read more