The US-based media outlet Bloomberg forecasted on Friday that the naira would weaken much more in 2024.
The journal claims that 2019 would be the worst year for the naira since democracy was restored in 1999 and that experts expect additional decline in 2024.
According to the report, on Thursday in the official market, the naira dropped by 55% against the dollar, or N1,043 per unit.
Among the 151 currencies that Bloomberg tracks, the decrease put the naira in third place globally in terms of performance, after the Argentine peso and the Lebanese pound.
According to the research, Nigeria’s foreign reserves are at their lowest point in six years, with the majority of them being weighed down by unpaid short-term debts abroad.
The article claims that the 12-month contract for the naira is trading close to a record low of N1,294.44 to the dollar in the non-deliverable futures market.
After the Central Bank of Nigeria (CBN) united all areas of the foreign exchange (FX) market, allowing the currency to trade with greater freedom, the devaluation started in June 2023.
President Bola Tinubu then discontinued the petrol subsidy.
According to the journal, inflation, which is at 28.2 percent while the benchmark interest rate is at 18.75 percent, was caused by the removal of the gasoline subsidy and the depreciation of the naira.
The research stated that foreign investors had been discouraged by the negative real interest rate.
According to Vetiva Capital Management Ltd., unless Tinubu’s government increases oil output or draws in foreign investment, the naira may weaken even more.
Bloomberg’s forecast differs from the CEO Bismarck Rewane’s, who stated that an increase in Nigeria’s exchange rate is anticipated in 2024.
The governor of the top bank, Olayemi Cardoso, also predicted that pressure on currency rates will lessen considerably in the upcoming year.