Nigeria’s external reserves continue to show an upward trend as they rose to $35.11billion on Monday, September 13, 2021 from $34.86billion on September 9, 2021, latest data obtained from the Central Bank of Nigeria (CBN) shows. The external reserves have been heading north since August 25, 2021 when they stood at $33.48billion.
This means that the reserves increased by $1.63billion in less than three weeks. Analysts attribute the accretion to the external reserves in the last few weeks to Nigeria’s $3.35 billion share of the International Monetary Fund’s (IMF) $650bn Special Drawing Rights (SDRs)-about SDR 456 billion- allocation which, the Fund said, came into effect on August 23, and is aimed at helping its member countries cope with the impact of the Covid-19 crisis.
The SDR, an international reserve asset created by the IMF in 1969 to supplement its member countries’ official reserves, can be exchanged among governments for freely usable currencies in times of need. Before the IMF’s $650billion SDRs came into effect, Nigeria’s external reserves have been on a downward trend, sliding from $35.37 billion recorded on December 31st 2020 to $33.43billion on August 23 2021. Financial analysts had predicted that Nigeria’s $3.35 billion of the IMF’s $650billion SDRs will significantly boost the country’s external reserves.