External reserves gain $76.5 billion in seven days

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Guardianng July 26, 2021 4:14 a.m.

External reserves gain $76.5 billion in seven days

The falling reserves, experts warned, could leave the country’s battled economic outlook worse off as the confidence of foreign investors is partly influenced by the size of the reserve.

“The value of the naira and foreign investors’ confidence in the economy is tied to the level of foreign reserve available.

While falling external reserves are seen as a falling knife for any economy, especially a highly import-dependent, the Chief Consultant of B.

Adedipe Associates Limited, Biodun Adedipe, said Nigeria faces a major crisis any time its reserve falls below the estimated value of its six-month imports.

David Adonri, an investment expert and economist, warned that Nigeria, like every other import-dependent country, needed a supportive foreign reserve to meet its needs.

“The main source of forex inflow is earnings from crude oil export held by CBN in foreign reserves supported by diaspora remittances and export proceeds.

The liquid reserve is the component available in cash/or equivalent while gross comprises liquid and blocked portion – part of the asset held in securities and other investments.

The country’s reserves have been affected by its weakened foreign earning capacity and rising import bills.

The Guardian had earlier reported that Nigeria faced a tough challenge financing its huge import as the foreign reserve holdings continue to tumble..

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