The external reserves, which stood at $47.11bn at the end of last month, declined to $46.128bn on August 23, 2018.
The CBN noted that the evolution of the
forex market in the country had been influenced by a number of factors
such as the changing pattern of international trade, institutional
changes in the economy and structural shifts in production.
A former President, Association of
National Accountants of Nigeria, Dr Sam Nzekwe, who described oil as the
nation’s major revenue earner, said the reserves had grown in recent
months because oil price was increasing, and production was constant.
He, however, said political
uncertainties had led to a decline in foreign investment as many
investors were taking their funds out of the country.
“So, I believe that what must have
happened is that those of them whose investments are short-term like
shares and bonds, have found their way out of Nigeria,” he added.
He observed that most of the investors had not really been investing in the real sector.
According to Nzekwe, generally, a lot of people are not sure of what will happen during elections.
He added that although the government
was investing in infrastructure, the investments in infrastructure were
mostly being constructed by foreigners with foreign materials.
He said, “So basically, it will have
some impact on the reserves but I believe that the major one is the
foreign investment in the financial market and they are all short-term
investments.”
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