Nigeria’s external reserve falls by $177m in 2 weeks

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The appreciation recorded by the naira in the various segments of the foreign exchange market last week is expected to persist this week, even as the external reserves continued on a downward trend, falling by $177 million in two weeks, due to increased dollar sales by the Central Bank of Nigeria, CBN, in its effort to stem the depreciation of the naira. Last week, the naira reversed the sharp depreciation suffered the previous week, as it appreciated in the parallel market and in the Investors and Exporters, I&E, courtesy of measures introduced by the apex bank to boost dollar supply.

Among other things the CBN increased dollar sales to each bureaux de change, BDCs, to $60,000 per week from $40,000, while it directed banks to sell dollars to all travellers with valid documents, customers and non-customers. In addition the CBN intervened in the I&E window to boost supply in the window, while it sustained its weekly $210 million intervention in the interbank foreign exchange market. Consequently, the naira appreciated by 72 kobo in the I&E window, as the indicative exchange rate dropped to N360.85 per dollar on Friday from N361.57 per dollar the previous week.

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