Central Bank Of Nigeria Injects $15.3 Billion Into The Economy To Stabilize Naira

The Central Bank of Nigeria injected $15.3 billion into the economy from January to October of 2022 to stabilize the naira's value.

According to the banking sector regulator's monthly and quarterly economic report, the economy received funding of $4.86 billion, $4.81 billion, and $4.18 billion during the first, second, and third quarters, respectively, and $1.46 billion in October.

First quarter

Authorized dealers saw a 5.8% decrease in total foreign exchange sales from the bank, amounting to $4.86 billion in the first quarter. Interbank/invisible and SMIS windows sales saw a 16.9% and 10.8% decrease respectively, amounting to $0.46 billion and $1.79 billion, compared to the previous quarter.

Furthermore, SME interventions and sales at the Investors & Exporters window decreased by 2.0% and 26.7 percent respectively, amounting to $0.38 billion and $1.41 billion. The report also stated that matured swap contracts increased by 187.33 percent to $0.82 billion in comparison to the previous quarter.

Second quarter

Sales made by authorized dealers in the second quarter were $4.81 billion, a decrease of 0.9% from the first quarter, according to the Central Bank of Nigeria (CBN). A breakdown of the figures shows that sales in small and medium enterprises (SMEs) and sales in the investors & exporters window fell by 8.6% and 41.3%, to $0.34 billion and $0.83 billion respectively, when compared to the previous quarter. " Interbank/Invisibles and SMIS windows, increased by 5.3 percent and 14.7 percent to $0.48bn and $2.05bn, compared with the amounts in the preceding quarter," it said, as per Punch.

The CBN also reported that matured swap contracts increased by 34.6% to $1.11 billion over the same period.

Third quarter

The bank's total sales of foreign currency to authorized dealers dropped throughout the evaluation period in the third quarter of 2022. Foreign currency sales were $4.18 billion, a fall of 13.1% from the previous quarter's level.

"A disaggregation shows that foreign exchange sales at the Secondary Market Intervention Sales and Investors' and Exporters' windows, decreased by 10.5 percent and 4.3 percent to $1.83bn and $0.79bn, respectively. Similarly, matured swap contracts fell by 48.9 percent to $0.57bn, relative to 2022, Q2," the bank said.

The CBN did note that sales in the Small and Medium Enterprises and interbank/Invisibles windows had climbed by 32.4 percent and 10.0 percent, respectively, to $0.46 billion and $0.53 billion.

October 2022

Total foreign exchange sales by the Bank to authorized dealers in October were $1.46 billion, up 31.7% from $1.11 billion in September, according to the CBN.

The report further revealed that relative to the previous month's levels, foreign exchange sales at the Small and Medium Enterprises, Secondary Market Intervention Sales, and Invisibles window rose by 27.0%, 21.2%, and 61.2% to $0.15 billion, $0.58 billion, and $0.24 billion, respectively.

Additionally, matured swap contract value increased by 73.4% to $0.36 billion from $0.21 billion. Although sales through the Investors and Exporters window were down from $0.15 billion in September 2022 to $0.12 billion in October.