Nigeria’s foreign exchange (forex) inflow dropped by 25 per cent to $9.72 per cent in April, from the $12.15 billion recorded in March, according to a report by the Central Bank of Nigeria (CBN).
The apex bank, in its monthly economic report for April, attributed the development to the weak global demand caused by the COVID-19 pandemic.
The decline in inflows, relative to the level in March, was also attributed to the lower receipts from oil sources, which fell sharply by 15.5 per cent as a result of the plunge in average crude oil price from $32.30 per barrel at the onset of the pandemic in March, to $14.30 per barrel in April.
The slump in crude oil price was induced by the weak global demand on account of the lockdown of most economies following the continued spread of COVID-19.
According to the report, inflow through autonomous sources, particularly invisible purchases, declined by 57.3 per cent to $3.78 billion, relative to the preceding month, but higher than the 44.1 per cent increase in inflows through the CBN, which stood at $5.94 billion in April.
It explained that following the lockdown of the Nigerian economy, aggregate foreign exchange outflows through the economy decreased by 55.1 per cent to $3.29 billion in April.
“Aggregate outflow of foreign exchange from CBN fell by 55.1 per cent to $3.29 billion in April 2020, below the level in the preceding month. The development was driven, largely, by the 69.3 per cent decline in interbank utilisation, reflecting a substantial decline in I&E funding and non-intervention in the BDC segment in April 2020.
“Similarly, outflow through autonomous sources, mainly imports and invisibles declined by 62.2 per cent to $0.13 billion in April 2020, below the level in March 2020.
“Consequently, a net inflow of $6.43 billion was recorded through the economy in April 2020, compared with the net inflow of $5.63 billion in the preceding month,” it added.
It showed that the total amount of forex sold by the bank to authorised dealers in the month under review decreased by 82.2 per cent to $0.84 billion in April, from $4.70 billion in March, due to the low demand for forex as a result of the closure of factories and businesses.
Also, forex sales at I&E window declined by 78.5 per cent to $0.78 billion relative to the preceding month’s level of $3.61 billion. However, interbank sales rose significantly by 2,900 per cent to $0.06 billion, above the $0.002 billion sales in March.