Nigeria’s external reserves have decreased by $2.16 billion over the past month, reaching a seven-year low of $32.29 billion on April 15, 2024, according to data from the Central Bank of Nigeria (CBN). This decline has sparked worries about the country’s financial stability.

A recent report by Bloomberg highlighted Nigeria’s rapid depletion of foreign exchange reserves, suggesting that the central bank is using its dollar holdings to stabilize the naira following a pledge to allow the currency to float more freely.

Liquid reserves have fallen by 5.6% since March 18, marking the largest decline in a similar period since April 2020. CBN Governor Olayemi Cardoso addressed concerns about the diminishing reserves, attributing the decline to factors such as debt repayments and other financial obligations.

Cardoso emphasized the importance of maintaining liquidity in the market, stating that regular outflows of funds, ranging from $600 million to $1 billion, are necessary to uphold credibility and fulfill financial obligations.

Source: Daily Trust