Nigeria's soaring external reserves has shrank drastically in the last couple of days as the local economy continues to struggle.
The nation’s foreign exchange reserves have pared some of the gains recorded last month, falling by $102m in the six days to Wednesday.
Available data obtained from the Central Bank of Nigeria on Thursday showed that the reserves stood at $47.697bn on July 11, down from $47.799bn on July 5.
The reserves rose to $47.789bn on June 29 from $47.605bn on May 31, according to the CBN data.
On Tuesday, the CBN said it injected the sum of $210m into the interbank foreign exchange market to meet customers’ requests in various segments of the market.
The apex bank said it offered $100m to authorised dealers in the wholesale segment of the market, while the Small and Medium-Scale Enterprises segment got the sum of $55m.
It said customers needing forex for invisibles such as tuition fees, medical payments and Basic Travel Allowance, among others, were also allocated the sum of $55m.
The naira is expected to be stable next week, which is driven by exporters selling dollars on the interbank currency market, Reuters quoted traders as saying.
The naira has been trading between 362 and 363 per dollar for a while as customers shy away from trading the currency weaker. Traders say dollar liquidity improved this week with lenders selling export proceeds to customers.
On the official interbank market, the naira is quoted at around 305 against the dollar.
Meanwhile, analysts at FSDH Merchant Bank have noted that the external sector of the Nigerian economy improved further in the first quarter of 2018 as it recorded the best trade performance in the last nine quarters.
They stated in their latest monthly financial and economic report that the figures for Q1 2018, as published by the National Bureau of Statistics, revealed a noticeable improvement in the major indicators of the Nigerian foreign trade data.
The analysts said, “These Q1 2018 figures are broadly consistent with the 2018 forecast that FSDH Research published earlier this year in our Economic and Financial Market Reports for the period of 2018 to 2022. The strong foreign trade should help to sustain stability in the foreign exchange market.
“Our analysis shows that the total value of merchandise trade increased by 19.74 per cent to N7.21tn in Q1 2018 from N6.02tn in Q4 2017 and an increase of 34.83 per cent from N5.34tn in Q1 2017.
"Exports, at N4.7tn, accounted for 65 per cent of the total trade while imports, at N2.5tn, accounted for 35 per cent. Trade balance (the difference between exports and imports) increased by 22 per cent to N2.2tn in Q1 2018 from N1.8tn in Q4 2017.”