“It Is Possible”: FG Speaks on Naira to US Dollar Exchange Rate, Sets New Target for 2024

“It Is Possible”: FG Speaks on Naira to US Dollar Exchange Rate, Sets New Target for 2024

  • The federal government has expressed optimism about the naira exchange rate for the coming year
  • Ben Akabueze, the DG of the Budget office, also believe that the exchange rate target for 2024 can be achieve
  • The Naira in 2023 recorded its worst performance in the official and unofficial foreign exchange market

Legit.ng journalist Dave Ibemere has over a decade of experience covering tech, energy, stocks, investments, and the economy.

Ben Akabueze, the director-general of the federation's budget office, has said that the Naira will strengthen in value in the foreign exchange market in 2024.

Speaking in an interview with Channels TV on Tuesday, December 26, 2023, the Budget Office DG said this will be possible as the country expects an increase in dollar supply.

Naira to dollar exchange rate
FG hopes to achieve the exchange rate target in 2024. Photo credit: Benson Ibeabuchi
Source: Getty Images

He noted that the Tinubu-led government expects the reforms initiated in 2023 to start yielding results in 2024, which is why it maintains a positive stance on the exchange rate.

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Legit.ng had reported that the federal government's 2024 budget of N27.5 trillion has a projected N750 to dollar exchange rate.

Akabueze believes the exchange rate is feasible.

His words:

“The N750/$ exchange rate in the 2024 budget is verypossible. We may begin the year with a little higher amount but if all that the Central Bank of Nigeria says it would do is put in place, as well as other things, we should expect to see a significant increase in the supply of foreign exchange in the economy in 2024.
"When the dollar supply increases, there will be an improvement in the value of the naira. Right now our majour objective is in taking actions to encourage the influx of foreign investors to into the economy.

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Punch reports that the Budget DG further noted that the government chose the exchange rate to reflect its policy direction.

Expert not optimistic

Reacting to the target, Uche Uwaleke, Professor of Capital Market, is unconvinced, describing it as a tall order.

According to him, the naira float in the face of weak supply and strong demand with its attendant forex market volatility brings uncertainty.

"The exchange rate is most likely to be the primary cause of significant budget variances in the 2024 budget due to Nigerian Autonomous Foreign Exchange Market operations."

Economist sets new exchange rate in 2024

Earlier, Legit.ng reported that the Economist Intelligence Unit (EIU), a research and analysis firm, predicted that the Naira would close in 2023 with an exchange rate of N848/$ in the official market.

The EIU said that by the end of 2024, they expect the Naira to be worth N861.5 compared to one US dollar.

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They also predicted that in 2024, the pressure on the Naira might reduce if the CBN does not introduce strict measures.

Source: Legit.ng

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