The nation’s external reserves have depreciated from $48, 471 billion in June 18 to $46,203 billion as at September 16, according to data from the Central Bank of Nigeria, CBN, representing over 3 per cent decrease in three months.
The reserves which hit $48 billion mark in June began to slide. In July 18, it went down to $46,933 billion and a month later in August 18; it was $47,056 billion. Until July some two months ago the nation’s external reserves had risen steadily since last year due to high oil prices and stability in the foreign exchange market.
It was gathered that the performance of the reserves was driven mainly by proceeds from crude oil, gas exports and crude oil-related taxes as well as reduced funding of the Wholesale Dutch Auction System on the account of huge inflow of foreign portfolio investments. The Federal Government had targeted $50bn mark by the end of 20 12. The reserves however closed the year at $44.26bn on December 24, 2012, finishing $6bn below the government’s target.
The Governor, Central Bank of Nigeria, Mr. Lamido Sanusi, said in May 2013 that the outlook for the country’s foreign reserves this year was mixed. Sanusi told Bloomberg that the foreign-currency reserves would probably keep expanding while facing risks from lower-thanprojected oil output and falling prices.
He said, “Quantitative easing by central banks in the United States, the United Kingdom and Japan all point to a likelihood of strong capital flows to emerging and frontier markets that may benefit Nigeria.
Still, the combination of lower global oil prices and weak output performance in Nigeria may lead to a slowdown.” Oil production in Nigeria fell to 1.81 million barrels a day in March, the lowest level since September 2009.