MON DEC 30 2024-theGBJournal| As at the close of the year, official exchange rate [NFEM] was N1,537 up from an average of N1,455.59 in January 2024 and N907.1 in December 2023. However, from July to December 2024, the rate had largely stabilized.
The moderation in exchange rate volatility was informed by the series of regulatory reforms and the periodic intervention by the Central Bank in the forex market.
Meanwhile the balance of outlook for the exchange rate in 2025 is on the upside based on the following expectations:
-Sustained improvement in foreign reserves which is currently in excess of $40 billion dollars.
-Improvement in accretion to reserves on the back of improved inflows from the IMTOs and diaspora remittances.
-Improved capacity of the CBN to moderate rate volatility through periodic intervention in the forex market.
-The positive impact of the $2 billion Euro Bond proceeds on reserves.
-Positive Impact of the successful domestic dollar bond of $500 million.
-The successful clearance of legacy forex obligations of about $7 billion by the CBN.
-The Import substitution effect of the Dangote and Port Harcourt refineries with the consequential easing of demand pressure on the forex market.
-Gradual recovery of non-oil export sector and implications for forex inflows.
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