The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, announced on Tuesday that the country’s foreign reserves increased by 12.74% to $39.12 billion as of October 11, 2024. This marks a rise from $34.70 billion at the end of June 2024.
He made the disclosure while addressing the House of Representatives Committee on Banking Regulation in Abuja.
Cardoso attributed the growth in reserves to foreign capital inflows and revenues from crude oil-related taxes.
“The reserves rose by 12.74 per cent to $39.12 billion as of October 11, 2024, from $34.70 billion at the end of June 2024,” he said. He further explained that remittances now account for 9.4% of the country’s external reserves.
Cardoso highlighted that Nigeria maintained a current account surplus in the second quarter of 2024, with significant improvements in the trade balance.
He noted, “The current external reserves position can finance over 12 months of import of goods and services or 15 months of goods only. This is substantially higher than the prescribed international benchmark of 30 months, reflecting a robust buffer against external shocks.”
On the foreign exchange market, the CBN governor detailed reforms implemented by the bank, including a unification strategy that streamlined exchange rate windows.
He said, “We have achieved increased transparency and improved overall supply. By allowing the foreign exchange rate to be determined by market demand and supply, the CBN has reduced arbitrage and speculative activities.”
Cardoso also addressed the issue of inflation, which rose to 32.7% in September after two months of decline.
He acknowledged inflation as a concern but noted, “Inflation has shown gradual moderation, indicating that the monetary policy measures were becoming effective.”
He expressed optimism that inflationary pressures would continue to ease in the last quarter of 2024, supported by ongoing policy measures and recent government initiatives.
The CBN governor emphasized that the bank had reverted to a more traditional approach to managing inflation, raising the policy rate to 27.25% and adopting an inflation-targeting monetary policy framework. This framework, according to Cardoso, is widely used globally for its effectiveness in addressing persistent inflation.
Cardoso reiterated the CBN’s commitment to stabilizing prices, managing liquidity, and ensuring an effective monetary policy framework as part of its broader enterprise strategy for 2024-2028.