Growing reserves positive outlook for Nigeria – Expert

Growing reserves positive outlook for Nigeria – Expert
United Bank for Africa

The rising level of the nation’s foreign reserves is a clear indication of a positive outlook for Nigeria, says a financial expert, Mr Titus Okurounmu.

Okurounmu, a former Director, Research Department, Central Bank of Nigeria (CBN), made this known in an interview with Newsverge in Lagos.

The CBN had, on March 9, announced that the reserves stood at 30 billion dollars with an increase of between 2.30 and 2.75 per cent day-on-day since Jan. 5.

The last time the reserves crossed the 30 billion dollars mark was July 2015 and went as high as 31.63 billion dollars in August before it declined.

The expert expressed optimism that the increase in the foreign exchange reserves would boost investors’ confidence, particularly in generating portfolio investment.

He said that the accumulation of reserves served as a cover against external shocks like the volatility in the international oil market.

Okurounmu attributed the successful Euro-bond sale to the investors’ confidence which was hinged in the fact that the nation’s foreign exchange reserves were adequately enough due to high return on investment.

He cited countries like China and Saudi Arabia as countries that had accumulated up to three trillion dollars and 500 billion dollars and still ensuring that they grew their reserves further.

The expert said the foreign exchange reserve was for meeting the international finance obligations, including sovereign and commercial debts, financing of imports.

According to him, the increase helps in boosting confidence at the international market with the ability of the country to meet its external obligations.