Not sure we should celebrate N1,200/$ since it took Naira about 50 years to get from about N1/$ to N415/$, only to crash to N1,600/$ in 9 months: “Goldman Sachs analysts Andrew Matheny and Bojosi Morule have projected a significant turnaround for Nigeria’s currency, foreseeing a remarkable appreciation to N1,200 against the US dollar within the span of 12 months.” Naira is currently hovering around N1,600/$.
Indeed, anything more than N600/$ should be considered a monumental bad policy in the annals of history. Also, do not waste your time thinking that Wall Street banks understand what is happening in Nigeria. From JP Morgan to GS and even IMF, all of them called it wrong after the floating:
“Also, in June 2023, JP Morgan projected that the naira, which was at N755/$1 then, would appreciate in the coming months, trading around N600 to a dollar. A statement by the institution said: “While it will take a few days for USD/NGN spot to settle, we fully expect an initial overshoot towards the parallel market rate of -750 or higher, after which, we expect USD/NGN to settle in the high 600s over [the] coming months.”
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Their assumptions about Nigeria are off by miles and those predictions have no real values. I mean they should not be wasting their time sharing opinions on where the Naira will settle, since the $billions we were promised will come from investors, after floating the Naira are yet to arrive.
If Nigeria had attracted say $50 billion post-float, things would have normalized. But the problem is that the floating has depressed investments, triggering a paralysis across the nation. If the government can find how to adjust for that, at least Naira will stabilize.
Nigeria’s problem now is not even Naira as the abduction of students has returned at scale, with more than 400 under the control of terrorists in the last 6 days.
Early this week, reports of mass abduction of residents across communities in Borno and Kaduna states by armed groups, compounded an existing insecurity and economic hardship in Nigeria under the watch of President Bola Tinubu.
The communities in Borno and Kaduna where the kidnappings occurred are some of the most insecure communities in the troubled states and have witnessed repeated terror attacks in the past. The insecurity in the areas also means limited access to non-residents including journalists, making real-time information difficult to get.
Goldman Sachs Analysts Forecast Naira Appreciation to N1,200/$ in 12 months
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