Market News

Contrary to wide expectations, the Naira is projected to rise in value against the greenback in early 2025 just as the hyperinflation rate will ease considerably, amongst other positive fundamentals, experts have said.

The duo of Dr. ‘Biodun Adedipe and Mrs. ‘Laide John, both of B. Adedipe Associates Limited (BAA Consult), gave this blessed assurance during the recent interface and discussion session at the FirstBank Nigeria Economic Outlook 2025.

The FirstBank Nigeria Economic Outlook is designed to consider various indicators and factors, including monetary policies, government spending, trade relations, and global economic conditions with the crop of experts that would be at the session.

Firing the first salvo, Dr. Adedipe, founder/Chief Consultant at B. Adedipe Associates Limited (BAA Consult), recalled that the Naira exchange rate stability envisaged before end-H1’2024 happened.

According to him, the expected average official rate at end-2024 N1,452.13/$ and PM average of N1,516.02/$, noting that the pressure on FX should be moderated by Naira sale of crude oil to local refineries, CBN clearing of FX backlog, high MPR to drive FX inflow (largely FPI) that may reverse when MPR begins southward adjustment.

“Inflation is expected to reach an inflection point in the early part of 2025, causing a potential downward trajectory of MPR. Tightening by CBN, effects of tax reforms (if implemented), and supply-side bottleneck issues tamed should result in a reduction in Inflation rate. If you consider official disbursements, remittances, portfolio inflows, and lower imports amid rising domestic refining production and the impact of currency depreciation on domestic demand.”

Pressed further, Adedipe said, “The envisaged rebound is promising. There are promising movements in dealing with food and manufacturing deficits. If the energy deficit gets firmly on the reform train, the Nigerian business environment should become very, very interesting. The chances are about 70%!”