Nigeria's external reserves increase to $37.869 billion

Nigeria’s gross external reserves balance increased to about $37.869 billion amidst sustained foreign currency inflows into the economy, data from the Central Bank (CBN) showed.

The balanced in external reserves increased for the fourth consecutive time this week, as the gross reserve level grew by US$397 billion from $37.471 billion last week Friday.

Based on the latest trajectory, Nigeria’s foreign reserves could cross $38 billion in the next few weeks, analysts projected, despite pressure on crude oil prices in the global commodities market.

Oil prices experienced a weekly decline due to the possibility of increased oil supplies from Saudi Arabia, which outweighed China’s efforts to boost its economy.

As of the latest report, Brent oil dropped by 3.11% to $72.34 per barrel for the week, while US benchmark West Texas Intermediate (WTI) decreased by 5.25% to $68.55 per barrel.

Accretion into the external reserves has been strong and steady, but the need to defend the naira has remained downside to its growth. At the current level, foreign reserves comfortably provide more than 13 months of import cover, according to analysts, using the latest trade data.

MarketForces Africa gathered that Nigeria’s gross external reserves often increase when prices of crude oil rise and there is strong production volume for exports.

Last week, gold prices were on track for their strongest quarter in over eight years, reaching a series of record highs in recent sessions. Gold increased by about 1.00% week-on-week, reaching $2,674.30 per ounce.