Nigeria’s External Reserve Rises To US$39.12 Billion —Cardoso

By Angel Ike

The Central Bank of Nigeria, CBN said the foreign exchange reserves have grown significantly, with remittance flows currently representing 9.4 per cent of total external reserves.

The Apex bank also said the reserves rose by 12.74% to US$39.12 billion as of October 11, 2024, from US$34.70 billion at end-June 2024, driven largely by foreign capital inflows, receipts from crude oil related taxes and third-party.

The Governor of the CBN, Yemi Cardoso disclosed this at a meeting with the house committee on Banking at the National Assembly.

He said the current external reserve position can finance over 12 months of import of goods and services, or 15 months of goods only.

This is substantially higher than the prescribed international benchmark of 3.0 months, reflecting a robust buffer against external shocks, he said.

He said that Inflation trended upward, driven largely by high food prices, cost of energy and legacy infrastructural challenges, but it commenced deceleration from 34.19% in June 2024 and to 33.40% in July 2024.

The Apex bank Governor,said the moderation in inflation became more pronounced in August 2024, as headline inflation further eased to 32.15%.

According to.him, this was largely attributed to monetary policy measures taken by the Bank, adding that inflation is expected to further trend downward in the near-to-medium term following the aggressive monetary policy tightening coupled with robust monetary- fiscal policy coordination.

He disclosed that CBN had fully reverted to orthodox monetary policy approach and implemented a comprehensive set of monetary policy measures to combat inflation.

These include raising the policy rate by 850 basis points to 27.25%, increasing Cash Reserve Ratios and normalising Open Market Operations as our primary liquidity management tool.

Cardoso said, “we have adopted an Inflation-Targeting (IT) monetary policy framework as part of the Bank’s Enterprise Strategy (2024 2028).

“These integrated measures are aimed at stabilizing prices, optimizing liquidity management, and engendering an effective monetary policy framework.

“Regarding the foreign exchange market, the Bank implemented various reforms including a unification strategy, which streamlined various exchange rate windows into a single model, adopting the ‘Willing Buyer, Willing Seller’ approach to enhance FX liquidity and financial market stability.

“This move was aimed at fostering transparency, reducing market distortions, and enhancing the efficiency of foreign exchange allocations.

“This consolidation involved the implementation of new operational guidelines, which included removing the International Money Transfer Operators (IMTOS) quote cap.

“Additionally, the Bank resumed the sales of FX at the NAFEM and Bureau De Change (BDC) segments, bolstered by an improved supply from Foreign Portfolio Investors (FPIs).