Nigeria’s external reserved has dropped to $30.22 billion, the lowest level in three months.The Central Bank of Nigeria (CBN) disclosed this Wednesday on its website.
The apex bank revealed that the external reserve dropped to $30.222 billion on Tuesday June 13th, representing a weekly decline of $68 million when compared with the $30.290 billion achieved the previous Tuesday of June 6th.
Analysts revealed that the new level of $30.22 billion represents the lowest level since March 14th, or 13 weeks ago, when the reserve was $30.23 billion. The reserve has been on the downward trend since May 4th when it reached a peak of $30.99 billion. Since then, the reserve has dropped by $770 million.
Meanwhile, the naira Wednesday remained stable at N364 per dollar in the parallel market due to weak demand for dollars.
Vanguard survey revealed that the parallel market exchange rate, which dropped to N364 per dollar on Tuesday, rose to N365 per dollar yesterday morning, but dropped to N364 per dollar at the close of business.
A bureaux de change (BDC) executive who spoke to Vanguard on condition of anonymity said the stability of the naira was due to low patronage and expected dollar sales to BDCs today.
The CBN sells $20,000 to each of the 3,145 BDCs across the country twice in a week specifically on Tuesdays and Thursdays.
Naira exchange rates converge at N367/$
The naira on Wednesday rose sharply against the dollar on the streets closing at N367 – $1 in Abuja and Lagos, recording a N15 gain from its previous close of N382/$.
Aminu Gwadabe, president of the Association of Bureaux De Change Operators of Nigeria (ABCON), said the strength of the local currency followed nearly $5 billion sustained intervention by the Godwin Emefiele-led Central Bank of Nigeria (CBN) in the interbank market since February.
He said the effectiveness of the CBN’s dollar injections in the interbank and the stability in the market require that the regulator reviews the rate band for bureaux de change (BDCs) downwards from N360/$ to $340/$.
Gwadabe said the naira has remained stable across the board in the near term on increased dollar supply to both the official interbank window and the black market. It has been trading around N382/$ on the parallel market in the last two weeks, while at the interbank market the naira was trading at around N305.40/$.