The Naira has shown no signs of improving its position in the FX markets as it hit a multi-week low this week. Experts are saying that the game plan by the CBN, through its intervention and attractive fixed-income yields, has not slowed the naira’s depreciation.
The Nigerian currency lost the N1,650/$ support line in the final trading session of the week.
According to data from the Nigerian Autonomous Foreign Exchange Market (NAFEM), the naira finished at N1652.25/$1, after finishing at N1,650.20/$1 on Thursday.
While the black market rate saw the naira selling for 1750/$1.
The naira has shown no signs of recovering against the dollar ever since mid-last year at the ascension of the President of Nigeria into power.
This month, the naira performed poorly in all segments, despite the country’s foreign exchange reserves reaching multi-month highs.
The CBN’s foreign reserves reached $40 billion, the highest amount in thirty-two months.
By 2028, the local currency is predicted to depreciate to N1,993/$, per recent research by Fitch Solutions subsidiary BMI.
With a forecast growth rate of 3% in 2024, up from 2% in 2023, Nigeria’s economy is expected to recover in 2025.
However, persistent issues like weak oil output, rising inflation, tighter monetary policies, and little foreign direct investment have hurt Nigeria’s foreign exchange market.
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