Few weeks after the inauguration of the Muhammadu Buhari’s administration, the nation’s foreign reserves went down by 2.73 percent.
Latest data obtained from the website of the Central Bank of Nigeria (CBN) on Thursday, showed that as at Wednesday, June 17, 2015, the reserves level stood at $29.004 billion, representing a drop of $815 million, or 2.73 percent month-to-date, from $29.819 billion at by May 18, 2015.
Before the latest drop, the reserves level was $29.595 billion at the end of May, 2015.
As part of efforts to check the free-fall of the Naira, the CBN restricted dollars sales in the interbank market in February, thereby sharply reducing liquidity in the interbank market and putting off foreign investors from buying equities and bonds in the country.
Meanwhile, the nation’s apex bank, the Central Bank of Nigeria (CBN), on Thursday released figures for currency-in-circulation for the month of May, showing that total money outside of the nation’s banking industry stood at N1.660 trillion.
An analysis of the April figure shows that it went down by N31.690 billion or 1.86 percent, when compared with the N1.692 trillion recorded at the end of the preceding month of April.
On a year-on-year basis, the figure represented a N143.039 billion or 9.42 percent more than the N1.517 trillion reported by the apex bank for May 2014.
Reacting to the drop in foreign reserves on Thursday, Rasheed Alao, Senior Lecturer in the Department of Economics, Adeyemi University of Education, Ondo, said the issue of foreign reserves should be taking very seriously by the Buhari’s administration, and that urgent steps should be taking by government to block all the loopholes in the economy which are affecting the foreign reserves.
His words: “I am of the opinion that the Buhari’s administration should urgently set up an economic team that will be proactive and which will comprise of notable economists and business men in the country who will be able to implement policies that will boost the nation’s external reserves”.
Also in a chat with Daily Independent on, Cyril Mpaka, former member of the budget team in Cross River State said the issue of foreign reserve is one that must be treated with serious caution by any government.
According to him, “one needs to ask why a nation’s foreign reserve deplete the way we have been experiencing it in the country.