IMF Predicts Next Naira to Dollar Exchange Rate in 2024, FG Hopes to Achieve N800/$1

• The International Monetary Fund has released its prediction for the Naira to dollar exchange rate by year-end
• This has come after the federal government reiterated its efforts to help the Naira find its true value in the exchange market
• Several new policies have been implemented in the last few weeks by both the CBN and the federal government

Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

The International Monetary Fund (IMF) has predicted that the naira to the US dollar could climb during the year to as high as N2,081/$1 in the official foreign exchange market.

IMF disclosed this in its February 2024 Post–Financing Assessment and Staff Report published on its website.

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IMF makes observations about the naira

According to the IMF, the naira may further depreciate by about 35% this year, potentially leading to an inflation rate peaking at 44%.

The global institution noted further that the nation’s monetary policy is insufficiently tightened to bring inflation below 20% while pressure on the Naira persists.

It added that the depreciation of the Naira will be caused by the absence of local production and the recent liberalization of commodity imports, Vanguard reports.

IMF advises the federal government

Following up on its observation, the IMF called for a comprehensive macroeconomic and growth strategy in collaboration with and supported by development partners.

It said this would include aggressive monetary tightening, fiscal adjustment to restore macroeconomic stability, and implementing climate adaptation measures.

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It stressed that domestic demand had weakened due to the steep fall in real incomes, as investments in the oil sector would likely stall due to rising costs and production declines.

FG searches for a solution

Meanwhile, President Bola Tinubu has disclosed a plan by the federal government to raise at least $10 billion in order to increase FX liquidity, a key ingredient to stabilise the naira and grow the economy.

The federal government will be hoping to achieve an exchange rate of N800 as the foreign exchange (FX) rate benchmark for the 2024 budget to avoid a heavy fiscal deficit.

The latest Naira to Dollar exchange rate

Earlier, Legit.ng reported that the Nigerian currency recovered some of its lost value against the US dollar in both the black market and the official market

This happened after the federal government of Nigeria deployed security agencies against foreign exchange speculators

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The FG has now issued a new order to the NCC to block Binance and other online platforms where Nigerians buy and sell dollars

Source: Legit.ng