The Nigerian Naira could fall to a value of N1,804 per US dollar at the official exchange market by 2025, according to a recent report by Afrinvest. The report, titled ‘Beyond The Rhetorics: Transforming Reforms to Tangibles’, highlights concerns about the country’s foreign exchange stability in the coming years.
The report suggests that the Central Bank of Nigeria (CBN) may face difficulties in maintaining a steady supply of foreign exchange to meet market demands. This challenge, combined with ongoing exchange rate fluctuations, could lead to further depreciation of the Naira.
Afrinvest stated, “We anticipate that exchange rate volatility would persist in 2025, albeit at a modest pace. 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.”
The projection contrasts with the N1,500 per dollar benchmark included in the proposed 2025 national budget currently under review by the National Assembly.
Despite this, the Naira recently showed slight improvement. As of Friday, it closed at N1,534 per dollar in the official market and N1,650 per dollar in the black market, according to Daily Post. The introduction of the Electronic Foreign Exchange Matching System (EFEMS) in October 2024 has been credited with bringing temporary stability, though long-term prospects remain uncertain.
