Nigeria’s Foreign Reserves Dips By $373.23 million

July 3, 2020
40 Views

The Central Bank of Nigeria, CBN, has warned the government to look beyond oil revenue and diversify the economy as the country’s foreign reserves fell by $373.23 million from $36.57 billion on June 1 to $36.2 billion on June 29.

The reserves maintained a steady rise at a level of $33.52 billion as of April 30, before commencing its downward trend in June, the Apex bank revealed.

The reserves previously hit a high of $45.17 billion on June 11, 2019, but lost $11 billion leaving the figure at $33.89 billion as of April 28, 2020.

A credit rating agency, Moody’s Investors Service said Nigerian banks’ foreign currency funding gap would rise to $5bn over the current low oil prices, volatile foreign inflows and lower remittances amid coronavirus pandemic.

The Agency in its July 2020 report, themed “Renewed foreign-currency shortages highlight vulnerability for banks”, noted that these challenges were threatening to renew the foreign currency liquidity pressures that blighted Nigerian banks during a previous oil crisis in 2016-2017.

An expert at Moody, Peter Mushangwe, said, “Lower dollar inflows at a time when foreign currency borrowing will likely be more expensive for Nigerian banks will strain their foreign currency funding, despite substantial improvements compared to 2016.

“Our moderate scenario where foreign-currency deposits decline by 20 per cent, while loans remain constant, would increase rated banks’ funding gap to N1.5tn translating to $3.8 billion, and to N1.9tn translating to $5.0 billion under our severe-case scenario of 35 per cent foreign-currency deposit contraction, creating acute funding challenge”.

The last Monetary Policy Committee, The CBN Governor, Mr Godwin Emefiele, had said the need for government to urgently reduce reliance on oil revenue by gradually diversifying the economy and improving tax collection cannot be over emphasised at such a time as this.

You may be interested

Governor Bala Mohammed Makes U-Turn, Begs Fulani Herdsmen Not To Carry AK-47
News
1 views
News
1 views

Governor Bala Mohammed Makes U-Turn, Begs Fulani Herdsmen Not To Carry AK-47

Webby - February 25, 2021

Bauchi State Governor, Bala Mohammed has begged Fulani herdsmen not to carry AK-47 rifles after facing backlash for defending the…

Police PPRO, Muyiwa Adejobi Accused Of Impregnating A Lady, Denying Child’s Paternity
News
6 views
News
6 views

Police PPRO, Muyiwa Adejobi Accused Of Impregnating A Lady, Denying Child’s Paternity

Webby - February 25, 2021

Lagos Police Public Relations Officer (PPRO), Muyiwa Adejobi has been accused of refusing to take responsibility for his child after…

Bandits kill 18 as troops neutralise bandits – Commissioner
News
2 views
News
2 views

Bandits kill 18 as troops neutralise bandits – Commissioner

Webby - February 25, 2021

/* custom css */ .tdi_75_ad3.td-a-rec{ text-align: center; }.tdi_75_ad3 .td-element-style{ z-index: -1; }.tdi_75_ad3.td-a-rec-img{ text-align: left; }.tdi_75_ad3.td-a-rec-img img{ margin: 0 auto 0…

Leave a Comment

Your email address will not be published.