External reserves reverse negative trend, rises to $35.7bn





.But Naira depreciation persists in parallel market


The nation’s external reserves, last week, rose (though slightly) for the first time in 12 weeks, to $35.66 billion.

Data from the Central Bank of Nigeria, CBN, shows that the reserves rose to $35.66 billion on Thursday last week, from $35.59 billion previous week. This represents the first week-on-week, WoW, increase in the external reserves since June 4, 2020, when it recorded WoW increase of $64 million.

The increase in reserves follows the four-week steady rise in the price of crude oil, which accounts for 90 percent of the nation’s dollar earnings. After falling steadily to less than $10 per barrel on April 21, 2020, from $71.98 per barrel on January 6, 2020, the price of Nigeria’s Bonny Light crude oil rose steadily to $44.3 on Monday, August 24, though it dropped to $42.93 last Friday.

But the declining fortunes of the nation’s currency, the Naira, in the parallel market persisted last week, in spite the announcement of resumption of dollar sales to Bureau de Changes (BDCs) operators by the Central Bank of Nigeria (CBN) on September 7, 2020.

According to naijabdcs.com, the live exchange rate platform of the Association of Bureaux De Change Operators of Nigeria (ABCON), the parallel market exchange rose to N476.3 per dollar last week from N475 the previous week.

However, the naira appreciated by 33 kobo last week in the Investors and Exporters (I&E) window as the indicative exchange rate dropped to N385.67 per dollar at the close of business on Friday from N386 per dollar the previous week.

The declining fortune of the Naira in the parallel market is expected to change next week while the huge gap (N90.63) between the parallel market exchange rate and the I&E exchange rate when the apex bank resumes sales of dollars to BDC operators.

According to analysts at Cowry Assets Management Company, “In the new week, we expect the widened disparity between different exchange rates to shrink, especially between I&E window (the autonomous window) and BDC segment, as CBN resumes the sale of dollars to BDC operators in the near future. “More so, given the renewed efforts by CBN to boost foreign currency supply and plug leakages, we expect to see Naira appreciate against the greenback in most market segments.”

Comments

Post a Comment

Popular posts from this blog

Tertiary institutions will reopen very soon — Minister

Image
National Union of Universities The Minister of State for Education, Hon. Chukwuemeka Nwajiuba, on Saturday, assured Nigerian students languishing at their homes that tertiary institutions across the country will reopen very soon. Though he did not give a specific date for the re-opening, he said he would articulate the situation report from the National Universities Commission, NUC, and other regulatory bodies of various tertiary institutions and present to the Presidential Task Force, PTF on COVID-19 for evaluation. Nwajiuba disclosed this during an NTA programme on ‘Nigeria Policy Brief on Education and COVID-19’, adding that he has received calls from private universities and public universities for reopening of tertiary institutions in the country. “Tertiary institutions across the country will open very soon. Private universities have written us, requesting that they are allowed to reopen ahead of public institutions. Vice-Chancellors have also requested that we allow them to reo
Read more

School is Scam: True or False? By Stanley Nwadike, University of Nigeria Nsukka

Image
Stanley Nwadike. Author: The Outstanding Student School is scam when said in Pidgin English (a parlance in Nigeria) can be rephrased to “School na Scam”. This slogan according to its users connotes that the idea of going to school is a waste of time because school is not contributive to one’s betterment in life. To them, going to school is not important because it seems there is no difference between those that went and those that did not.  When you here the slogan “School na Scam”, it’s just like one saying ‘school is useless’. This slogan or parlance is entirely false. It is being pushed and propagated by some deviants or those who are not willing to strive towards becoming useful or responsible to themselves and society at large. These set of people look for short cut to success and get-rich-quick avenues. To them, why waste time in school when others are making it big in the outside world. The funny aspect with people with this kind of mindset is that some of the famous people th
Read more

Thiago Silva says farewell to PSG ahead of Chelsea move

Image
Thiago Silva Thiago Silva took to social media on Wednesday to bid farewell to the Paris Saint-Germain faithful ahead of his anticipated move to Chelsea. Silva joined PSG in 2012 from AC Milan and went on to lead the French side to seven Ligue 1 titles in eight seasons, part of a total haul of 23 trophies during his time at Parc des Princes. But the Brazil defender was not offered a fresh contract at the end of his current deal, instead signing a temporary extension which came to an end with PSG’s defeat to Bayern Munich in Sunday’s Champions League final, the first in the club’s history. Chelsea have since emerged as the front-runners to sign Silva, with reports that he will soon sign a two-year deal to join the west London club circulating. Silva took the opportunity to pay tribute to his former supporters, quoting renowned Portuguese poet Fernando Pessoa in a heart-felt message shared on Instagram. “The value of things is not in the time that they last, but in the intensity with wh
Read more