The Nation's externel reserves depleted by $4.88bn in effort to stabilise the Naira

The efforts by the nations apex bank to stabilize the naira at the interbank market depleted foreign reserves by $4.9bn in the first quarter of 2015.

According to the CBN, the reserves fell by 14.3 per cent, down from $34.24bn at the end of December 2014 to $29.36bn at the end of March 2015.

The bank, in its latest External Sector Development Report for quarter one 2015, stated that the reserves for March 2015 dropped by $8bn when compared to what it was at the end of March 2014.

It attributed the decline in the external reserves to its intervention at the inter bank market, funding of the retail Dutch Auction system and the bank’s drive to stabilize the local currency.

It said, “The stock of external reserves at end-March 2015 stood at $29.36bn as against $34.24bn and $37.4bn recorded at end-December 2014 and end-March 2014, indicating respective depletion of $4.88bn and $8bn

A breakdown of external reserves by holdings, according to the report, revealed that the share of the CBN portion maintained the lead at $24.99bn (85.1 per cent) of the total, while the portion of the federation reserves and the Federal Government reserves stood at $2.26bn (7.7 per cent) and $2.10bn (7.2 per cent), respectively.

It noted that the aggregate demand for foreign exchange by the authorized dealers consisting of rDAS(Retail dutch auction system) and Bureau De Change operators in Q1 2015 amounted to $9.51bn as against $14.47bn and $16.2bn demanded in the preceding and corresponding quarters in 2014, representing declines of 34.3 and 41.3 per cent, respectively.