See why Nigeria's foreign exchange reserves are rising

Nigeria’s foreign reserves have witnessed a net inflow of about $2.35 billion in the first seven months of this year.

The minister of Finance and coordinating minister of the Economy, Wale Edun, disclosed this at the Corporate Customers Forum in Lagos on Thursday, September 19, 2024.

Edun acknowledged that the increase has played an essential role in stabilising the local currency, the naira, in the FX market.

According to the minister, Nigeria has also seen foreign exchange liquidity, with the gross reserves rising.

He attributed the growth to the government’s efforts, adding that the government’s revenues are also growing.

Punch reports that the minister said that Nigeria is seeing the gradual elimination of multiple exchange rates.

A previous report by TimesNow.com.ng disclosed that Nigeria’s firepower against naira depreciation, the foreign exchange reserves, increased by $621.2 million in 10 days following the successful sale of a government-issued domestic dollar bond.

The country’s gross FX reserves rose from $36.24 billion on September 2, 2024, to $36.87 billion by September 12, 2024.

The information is from the Central Bank of Nigeria (CBN).

According to the apex bank, the growth reflects the positive impact of the domestic dollar bond, which the Nigerian government said was oversubscribed by $400 million.

Reports say that on September 2, 2024, Nigeria’s external reserves stood at $36.24 billion but grew in the next 10 days to $36.87 billion as of September 12, 2024.

This development follows the massive recovery of the naira against the US dollar on Wednesday, September 18, 2024.

The Nigerian naira has appreciated against the US Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX). 

According to FMDQ Securities data, after trading on Wednesday, September 18, the naira closed at N1,539.65/$1 in the official market. 

Wednesday’s exchange rate is a massive improvement of 7.1% or N116.84 for the naira compared with the previous day’s exchange rate of N1,656.49/$1.

On Tuesday, TimesNow.com.ng reported that the naira closed at its worst exchange rate since February 2024. 

The recovery on Wednesday was due to an improvement in the supply of foreign exchange to the spot market, which contributed to the growth of the local currency. 

TimesNow.com.ng observed a 38.9% increase in forex transactions, with $139.48 million recorded on Wednesday, up from $100.39 million the previous day.

TimesNow.com.ng earlier reported that the Nigerian naira lost N100 against the US dollar in the official market amid slowing inflation, marking the second month inflation will ease.