'Expect it' - UK firms make exciting forecast on naira to dollar exchange rate in 2024

Analysts at Goldman Sachs Group Inc., Citigroup Inc. and Standard Chartered Plc have predicted that the Nigerian Naira currency will appreciate as much as 25% against the dollar in 2024.

According to the two financial institutions, the naira appreciation is due to the interest-rate increases by the Central Bank of Nigeria and other steps to attract foreign capital yields.

Earlier, Legit.ng reported that the CBN's Monetary Policy Committee (MPC) raised the Monetary Policy Rate(MPR), also known as interest rate, by four hundred basis points to 22.75% from 18.75%.

Also, the CBN said it attracted $530 million from Foreign Portfolio Investors FPIs during the sale of N1053 trillion worth of Treasury bill sales.

These moves by the Governor of CBN, Olayemi Cardoso, are believed by analysts to provide a strong platform for the naira to strengthen in value.

Naira to rise by 25% against US dollar

Razia Khan, chief economist for Africa and the Middle East at Standard Chartered, expects the naira to end 2024 in a 1,200-1,300 per dollar range, BusinessDay reports.

She said: “In more benign conditions, we could test even 1,100 naira a dollar or lower."

She noted that the expected strong performance of the naira is due to a series of measures taken by the CBN to support the currency.

She added: “Some of the forex backlogs have been cleared, monetary policy has been tightened and the transmission mechanism of policy is more effective."

Also, Goldman Sachs analysts, including Kamakshya Trivedi and Caesar Maasry, predicted that the naira could rally to 1,200 a dollar as investors seek richer returns from sovereign debt issued by frontier markets.