Naira Projected to Depreciate to N1,804 Per Dollar in 2025 – Afrinvest Report

The Nigerian Naira is projected to depreciate to a fair value of N1,804 per dollar at the official market by 2025, according to a recent Afrinvest report titled *“Beyond the Rhetorics: Transforming Reforms to Tangibles.”

The report attributes this projection to anticipated challenges faced by the Central Bank of Nigeria (CBN) in meeting foreign exchange (FX) demands and managing expected volatility in the FX market.

“We anticipate that exchange rate volatility will persist in 2025, albeit at a modest pace,” the report stated. “Our prognosis is hinged on the belief that the CBN would be constrained from adequately meeting market demand on a sustained basis, as the recent FX reserves accretion was largely driven by inflows from inorganic sources, including those with stringent conditions on usability.”

This projection surpasses the N1,500 per dollar benchmark proposed in the 2025 budget currently under review by the National Assembly.

Naira Performance in 2024
Meanwhile, the Naira has shown some recent fluctuations. As of Friday, it appreciated at the official market, closing at N1,534 per dollar, while trading at N1,650 per dollar on the black market.

Despite persistent Naira volatility throughout 2024, the introduction of the Electronic Foreign Exchange Matching System (EFEMS) in October has provided some relative stability. However, analysts suggest that sustained challenges in managing FX demands could lead to further depreciation in the coming year.

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