Naira’s Outlook Is Brightening Amid Steps to Steady Currency (2024)

FAQs

Naira’s Outlook Is Brightening Amid Steps to Steady Currency? ›

Naira's Outlook Is Brightening Amid Steps to Steady Currency

The Nigerian Naira is expected to trade at 1630.56 by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate it to trade at 1758.55 in 12 months time.

Nigeria's naira is recovering from record lows hit this year, following interventions by its central bank through interest rate rises and the direct sale of dollars to foreign exchange bureaus.

The Nigerian naira strengthened as the U.S. dollar index edged lower ahead of the U.S. CPI data and the televised U.S. presidential debate. The local currency began the week on an upswing against the U.S. dollar at the official market.

Limit monetary financing:

The government should limit its borrowing to the amount stipulated in law. Not adhering to this limit increases money supply which puts pressure on the exchange rate. The government should investigate widening its tax base as an alternative to monetary financing.

1 USD = 1,639.1 NGN Sep 16, 2024 20:18 UTC.

Financial analysts at United Capital Plc have forecasted that the exchange rate will stabilize, trending between N1,423.26/$ and N1,550/$ by the end of 2024. This projection was stated in their HY-2024 Economic Outlook Report, titled “Balancing Act: Nigeria's Path to Economic Stability.”

IMF Warns Naira May Experience Further 35% Depreciation in 2024 Due to Nigeria's Production Challenges. It said the country's growth could fall to zero in 2024 and only slowly recover to 2% in 2028.

The local naira currency, pegged for years at an artificially high level against the dollar, has since fallen 70%. Tinubu's goal was to trigger an influx of foreign capital and eventually make Nigeria a more attractive investment destination.

1 VES = 43.841171 NGN Sep 09, 2024 07:58 UTC

Check the currency rates against all the world currencies here.

What is making naira to appreciate? ›

The commencement of diesel and aviation jet fuel sales by the Dangote Refinery has seen a drop in the cost of the product. This is positive for the value of the naira. Therefore,the government must support a fully functional and private-led oil sector.

WHY IS THE NAIRA PLUMMETING IN VALUE? Under the previous leadership of the Central Bank of Nigeria, policymakers tightly controlled the rate of the naira against the dollar, thereby forcing individuals and businesses in need of dollars to head to the black market, where the currency was trading at a much lower rate.

Import dependency and limited exports contribute to the naira's instability despite CBN interventions. Strategic measures are needed to enhance crude production, facilitate exports, and reduce import reliance. Addressing supply-side constraints and high unemployment rates is crucial to combat inflation effectively.

According to him, the naira will gain strength if measures including fixing the nation's refineries, strengthening the education and health sectors are taken. “I think the current CBN governor should work on moral suasion to get people to pull out the dollars in their domiciliary account,” he said.

Why the naira is falling. The naira's decline stemmed from the dollar's growing scarcity and demand in Nigeria, compounded by persistent foreign exchange supply challenges and a significant demand backlog.

The Central Bank of Nigeria in line with its objectives to promote a market-based price discovery system in Nigeria's Foreign Exchange market, has recently implemented a series of reforms aimed at improving the valueof the Nigerian Naira, stabilizing the Nigerian foreign exchange (FX) market and fostering a mor ...

The exchange rate for US dollar to Nigerian nairas is currently 1,636.100 today, reflecting a 0.000% change since yesterday. Over the past week, the value of US dollar has remained relatively stable, with a 1.903% increase compared to its value 7 days ago.