Nigeria’s external reserves rise by 1.1% in 6 days

Nigeria’s external reserves rise by 1.1% in 6 days

- The CBN says Nigeria’s foreign reserves has accrued by $442.8 million or 1.07 per cent

- Nigeria's reserves was said to have crossed $41 billion on February 8, 2018, a level it last achieved in December 2013

- It was said to have increased by $2.62 billion or 6.7 per cent from $38.91 billion which it was as at January 2, 2018

Nigeria’s foreign reserves has accrued by $442.8 million or 1.07 per cent rising to $41.54 billion as at February 14, 2018, Leadership reports, quoting latest data on the website of the Central Bank of Nigeria (CBN).

The reserves was said to have crossed $41 billion on February 8, 2018, a level it last achieved in December 2013.

It was reported that analysts project that the reserves will continue to accrue this year, rising to almost $50 billion.

The news outlet also reports that the reserves has this year increased by $2.62 billion or 6.7 per cent from $38.91 billion which it was as at January 2, 2018.

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CBN director, banking supervision, Ahmed Abdullahi, who noted the increase in optimism in the Nigerian economy, said it is being fueled by: “The fact that we have a very low risk rating in the economy and we have one of the lowest risk premium as per the debt market.

“There is a very high confidence in the economy occasioned by the fact that the reserves is at the highest level and we are talking of reserves of about $42 billion at the moment. We closed the year at about $40 billion in 2017 and it has risen to about $42 billion,” he stated. The CBN has introduced several polices to increase the flow of foreign exchange into the country and stem the volatility at the foreign exchange market.

The Federal Government had also floated 2.5 billion dollars aggregate Eurobonds under its Global Medium Term Note Programme.

A statement obtained from the website of Debt Management Office (DMO) on Friday, February 16, in Abuja, said that the bonds comprised 1.25 billion dollars 12-year series and 1.25 billion dollars 20-year series.

The 12-year series has interest rate of 7.14 per cent, while the 20-year series has 7.69 per cent interest rate which will be repaid on maturity.

According to the statement, the offering is expected to close on or about February 23 subject to the satisfaction of various customary closing conditions.

The statement said that the offering had attracted significant interest from leading global institutional investors with a peak order of over 11.5 billion dollars.

Ms Patience Oniha, the Director General of DMO, said the successful pricing of the fifth Eurobond had conferred on Nigeria the status of issuer of Eurobonds with a strong and diverse investor base.

“This time Nigeria has priced a new 12-year bond at a yield of 7.14 per cent and a 20-year bond at a yield of 7.69 per cent, both of which are consistent in price with our existing portfolio.

“I am particularly pleased that the issuance will enable us to refinance a portion of our existing domestic debt portfolio with external debt at considerably lower cost.

“Also, the impact of the process has already led to a reduction in the cost of domestic borrowing, and so a double benefit for the cost of our broader debt portfolio.

“Lower domestic rates will also benefit corporate borrowers,” she said.

Kemi Adeosun, the Minister of Finance, said the proceeds of the issuance would be used to re-finance domestic debt.

The notes represent Nigeria’s fifth Eurobond issuance, following issuances in 2011, 2013 and two in 2017.

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Meanwhile, NAIJ.com had reported that the Nigerian Naira on Wednesday, August 2, maintained its strength at the parallel market as it stayed unchanged against the Dollar and Euro.

According to NAIJ.com's findings, the local currency closed the day at N363, N473 and N422 against the Dollar, Pound Sterling and the Euro respectively.

Can 1 Naira ever become 1 US dollar again on the Forex market? on NAIJ TV:

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Source: Naija.ng

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