Business a.m.
Goldman Sachs, the prominent international investment bank, recently announced that the Nigerian naira is, indeed, the top-performing currency in April, with its analysts predicting that the Naira could soon dip below the critical N1,000 per dollar mark.
In the latest instalment of Goldman Sachs’ comprehensive economic analysis of Nigeria, the investment bank’s team of economists illuminated an exciting prospect for the nation’s currency, the Naira. By their assessment, the current trajectory of the Naira’s value in the foreign exchange market suggests that it may appreciate beyond its current rate and even exchange below the critical N1,000 per dollar mark in the coming months.
The Goldman Sachs report made a striking observation that not only did the Naira rally 12 percent against the dollar in April, compounding on its impressive 14 percent surge in March, but also suggested that the nation’s currency may appreciate even further.
This revelation follows the financial giant’s prior forecast in March, predicting the Naira to appreciate to N1,200 per dollar by 2024, a projection that, remarkably, was swiftly realised with the Naira recently exchanging at N1,230.61 at the official market and N1,200 at the parallel market.
In a move that further strengthened the Naira’s position, the CBN implemented a strategic intervention by selling foreign exchange to Bureau De Change operators at a newly-revised rate of N1,101 per dollar, down from N1,251. The effect was immediate, with the Naira appreciating significantly, recording a gain of N60 to trade at N1,140 per dollar at the parallel market.
Over the past few months, the CBN has attributed the nation’s increased foreign currency inflow to its various policy interventions.
A crucial element of this strategy was the decision taken at the most recent meeting of the Monetary Policy Committee (MPC) to raise the interest rate to 24.75 percent, enabling the CBN to successfully reverse the losses incurred by the Naira as a result of two prior devaluations in June last year.
