Nigeria’s foreign exchange (FX) reserves have reached $33.58 billion, according to the latest data from the Central Bank of Nigeria (CBN).
This is the highest level since March 28, 2024, marking a significant financial milestone that coincides with the longest period of stable exchange rate seen in over a year.
The increase in FX reserves is attributed to a series of new multilateral loans from the World Bank. As of June 19, 2024, the CBN’s reserves stood at $33.58 billion, showcasing a notable recovery since the end of March 2024, when reserves were as high as $33.83 billion before experiencing a period of decline.
The rise in FX reserves follows three months of fluctuations, with reserves dropping to a low of $32.11 billion on April 19, 2024, leading to uneasiness about the nation’s financial stability.
Earlier this week, the CBN confirmed a $2.9 billion deposit in a special account to stabilize the forex market. This special account, identified as the Gazelle Funding Account, was discussed during the last Federation Account Allocation Committee (FAAC) meeting.
The FAAC Post Mortem Sub-Committee members noticed in last month’s report from the Nigerian National Petroleum Company Limited (NNPCL) that proceeds from Production Sharing Contract (PSC) Tax and Royalty sales were transferred to the Gazelle Funding Account.
The CBN backed NNPCL’s explanation, stating that the Federal Government secured a $3.3 billion loan from AfreximBank to stabilize the forex market.
According to the sub-committee report, “The structure of the loan requires NNPCL to deposit PSC Royalty and Tax proceeds into the Gazelle Funding Account. From these deposits, 90% will be released to NNPCL and CBN, while 10% will go towards repaying the loan.”
