Data released by the Central bank of Nigeria (CBN), showed that Nigeria’s foreign reserves fell to $31.57 billion by Feb. 25, down 8.33 percent from $34.44 billion in January.
The CBN has been drawing down on reserves to support the ailing Naira, hit by falling global oil price and escalating tensions ahead of forthcoming presidential elections in March.
Meanwhile, overnight lending rates fell to 8.25 percent on Friday, from 25 percent last week after monthly payments of budget allocations to government agencies and proceeds of cash call by joint crude-oil production partners.
Traders said about 256 billion naira ($1.26 billion) in January budget allocations was injected into the system on Thursday, while 60 billion naira from the cash call entered the market this week, forcing down borrowing cost among banks. Before the drop, lending rates hovered between 20 percent to 40 percent at the beginning of the week, owing to cash squeeze
Add your comments here.