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Emefiele: How CBN is battling to save Naira

...As external reserves plummet by $610m

Emeka Okoroanyanwu

Godwin Emefiele, governor of said Nigeria’s central bank is in a battle of its life to save the country’s sickly currency, the naira from further battering by other international currencies. This is even as the nation’s external reserves fell by $610m last month to N$41.22bn from $41.83bn in October.

The country’s reserves which gained $5bn in October went down in November.

An elated Godwin Emefiele, Central Bank Governor had said, at the Chartered Institute of Bankers of Nigeria’s dinner in Lagos that with support of the bank’s demand management policy, in addition, to support from the successful issuance of the $4bn Eurobond and the IMF SDR, the country’s external reserves stands at over $41.4bn, which is enough to support nine months of imports.

“This is not just a morale booster for both foreign direct and portfolio investors willing to invest in the economy, but it provides significant firepower to support our domestic industries that need to import critical machines and equipment for domestic production and exports,” he said.

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He said as a result of the drop in foreign exchange supply arising from low earnings from the sale of crude oil, the naira depreciated by 7.7 per cent from N380/$ to 410/$ at the I & E window, adding that supply was also affected by a massive outflow of foreign portfolio investments from emerging and frontier markets, including Nigeria in 2020.

“A combination of these factors led to a marked drop in our foreign reserves from nearly $36.7bn at the beginning of the crises in March said to a low of $32.9bn in June 2021,” Emefiele said, announcing that volume of activities at the I&E window fell from nearly $250m- $300m daily to less than $40m in the first