Nigeria’s reserves continued to rise, reaching $34.14 billion on Friday, up 4.06 percent from $32.74 billion on June 3, 2024, according to figures from the Central Bank of Nigeria.
The last rounds of loans the Federal Government received from the World Bank have bolstered the country’s reserves, according to The Punch.
In May, the Bureau of Public Enterprises announced that the Federal Government had acquired a $500 million World Bank loan to strengthen the country’s electrical distribution system.
In addition, the World Bank said that the country would get $2.25 billion to support in stabilising its economy.
“This combined $2.25bn package provides immediate financial and technical support to Nigeria’s urgent efforts to stabilise the economy and scale up support to the poor and most economically at risk. It further supports Nigeria’s ambitious, multi-year effort to raise non-oil revenues and safeguard oil revenues to promote fiscal sustainability and provide sufficient resources to deliver quality public services.” The multilateral lender stated in a statement.
As such, the external reserves have gained over $1bn in just one month.
Last year, the country faced a dollar deficit, prompting the central bank to float the naira to stimulate foreign cash inflows.
The naira has now devalued by more than 300 per cent in one year, reaching 1,514.31/$ at the Nigerian Autonomous Foreign Exchange Market on Friday.
According to a Bloomberg analysis published on Friday, the naira became the world’s worst-performing currency in the first half of 2024.
It stated that devaluation, limited dollar liquidity, and market volatility had hampered the Central Bank of Nigeria’s efforts to strengthen the currency.
“The naira’s performance is the worst among global currencies tracked by Bloomberg beside that of the pound in Lebanon, which is undergoing an economic crisis and witnessing dollarisation,” the report noted.
Meanwhile, the CBN Governor, Olayemi Cardoso, stated that the apex bank was “relatively pleased” with the progress made in stabilising the local currency.
“I do believe that we have more or less seen the worst in terms of volatility,” Cardoso told Bloomberg TV.
“The losing streak is the longest since July 2017 and takes the decline since the start of the year to 40 per cent.”
