Nigeria’s Minister of Finance, Budget, and National Planning, Zainab Ahmed has projected that the naira will fall soon.
Zainab said at an interview in Egypt, that Nigeria’s currency is likely to weaken even further, “It will happen with time,” she said, without giving any timeline.
The Minister ruled out Nigeria taking on an International Monetary Fund (IMF), program to address the country’s fiscal challenges, which include plummeting revenues and rising debt service costs.
Africa’s largest economy maintains multiple exchange rates dominated by a tightly controlled official rate and the unauthorized parallel rate at which many Nigerian get dollars, which is roughly 60% weaker. The World Bank and IMF have urged Nigeria to unify its rates.
The head of Africa Strategy at Standard Chartered Bank, Samir Gadio, said “the weakening of the official rate “looks more like a gradual and partial convergence to higher effective exchange rate levels as the central bank already sells USD to corporates at up to 465 naira on the spot market and auctions for small firms.
Gadio added that it was unlikely the outgoing government would adjust its official rate ahead of February’s presidential election