The International Monetary Fund, IMF, has on Wednesday, revealed that the Foreign Exchange, Forex, Reserve for Nigeria, has dropped by $2.9 billion within 8 months, .
The IMF in a statement after its end of Mission visit to Nigeria, said: “Despite supportive oil prices, gross FX reserves fell to $38.6 billion at end-May 2022, having reached $41.5 billion, in September 2021, boosted by Special Drawing Rights, SDR, allocation and Eurobond issuance.”
The IMF also stated that the current account deficit narrowed significantly in 2021, helped by import compression and higher net oil balance.
It noted: “However, the improving trade balance, which has continued so far in 2022, is having a limited impact on Forex strains with the exchange rate premiums in the parallel market staying in the 35-40 percent range since October 2021.”
On the real Gross Domestic Product, GDP, the IMF stated that the growth is broadening to all sectors except oil, but inflation remains high.
However, economic recovery continues to gain strength on the back of services and agriculture, with the GDP growth reaching 3.6 percent in Q1 2022.
“The economic outlook is challenging with high food prices, raising food security concerns”, while highlighting the Central Bank of Nigeria, CBN, inflationary intervention of raising its monetary policy rate by 150 basis points to 13 percent.
Positively, the IMF said that it believes the start of operations at the Dangote Refinery and decisive steps to mobilise revenues, in line with the Strategic Revenue Growth Initiative, SRGI, could spur inclusive growth and development.
An International Monetary Fund Team led by Ms. Jesmin Rahman, held meetings with the Nigerian authorities from June 6-10, 2022, to discuss recent economic and financial developments, and the economic outlook for the country.