Forex Flows Falls By 36%

Data from the Central Bank of Nigeria has shown that the foreign exchange flows through the economy fell year-on-year (YoY) by 36 per cent to $17.4 billion as of July 2022.

The increase was from $27.3 billion in the corresponding period of last year.

CBN’s monthly Economic Report for the month showed that aggregate foreign exchange inflow into the economy was $43.02 billion, compared with US$49.6 billion in the corresponding period of 2021.

Also, the total foreign exchange outflow rose by 14 per cent to $25.58 billion relative to $22.37 billion. Consequently, a net inflow of $17.4 billion was recorded during the period.

The data also showed that outflows through the CBN rose by 19.9 per cent to $20.05 billion in July 2022 from $16.71 billion in the corresponding period of 2021.

However, this came as CBN foreign exchange sales to authorized dealers fell YoY by 14 per cent to $11.42 billion in the July of 2022 from $13.35 billion in the same period last year.

A breakdown showed that SME interventions and matured swap contracts declined YoY by 2.7 per cent and 17.9 per cent to $739 million and $1.92 billion from $759.68 million and $2.34 billion respectively in 2021.

However, sales at the investors & exporters window, interbank/invisibles and SMIS windows, increased by 27 per cent, 33 per cent and 17.8 percent to $2.68 billion, $953.92 million and $4.55 billion compared with $2.1 billion, $714.6 million and $3.86 billion respectively in 2021.

In the July 2022 Economic Report the CBN noted that forex sales to authorised dealers fell month-on-month by 15.4 percent to $1.75 billion in July from $2.07 billion in June 2022.

The report stated:”Total foreign exchange sales to authorised dealers by the Bank was $1.75 billion in July, a decrease of 15.4 per cent, relative to US$2.07 billion in June.

“A breakdown shows that foreign exchange sales at the interbank/invisible window and matured Swaps decreased by 22.0 per cent and 59.1 per cent, respectively, to $0.13 billion and $0.27 billion, below their respective levels in the preceding month.

“In contrast, FX sales at Investors and Exporters (I&E), Secondary Market Intervention Sales (SMIS) and Small and Medium Enterprises (SMEs) windows rose by 5.8 per cent, 0.6 per cent and 65.7 per cent, respectively, to $0.44 billion, $0.72 billion, and $0.19 billion, compared to their levels in June.”

Kehinde Ogunyale

Reporting on the data-driven economy, and investigations.

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