There’s hope for the naira, Rewane declares
Bismarck Rewane, the Managing Director of Financial Derivatives Company Limited, is optimistic about the long-term maintenance of the naira’s recent appreciation against the US dollar.
The esteemed economist is confident in the naira’s ability to maintain its current gains against the dollar, provided the CBN takes appropriate action.
Throughout the week, the naira experienced an impressive surge, with an increase of over ₦500 against the dollar. This development represented a major milestone for the nation’s currency, as it experienced a sharp decline after the implementation of reforms by the Central Bank of Nigeria (CBN).Despite the positive run, there are still citizens who remain unconvinced about sustainability and have expressed their concerns accordingly.
However, Rewane has taken a positive perspective and outlined strategies to bolster the naira’s value.During an interview on Channels Television’s Politics Today programme, the prominent economist expressed confidence in the potential for the naira to experience significant growth through effective policies and implementation by the CBN.
He elaborated on the steps he mentioned to achieve sustainability.
One important factor to consider is the recent rise in interest rates, which has led to a higher inclination to save and a lower inclination to spend.
People are cutting back on their spending and, on the other hand, boosting their savings.”The government is demonstrating prudent financial management by reducing its consumption and increasing its savings.” I understand that there are restrictions on travel. From a leadership perspective, it is evident that there is significant inefficiency and mismanagement within the government.
However, we must recognise that we are still in the early stages of addressing these issues.Rewane stated that despite projections indicating a potential value of ₦1,200 for the naira, his company’s analysis revealed the possibility of even greater performance.
“The decrease in value from N1,915 to ₦1,475, as predicted by Goldman Sachs’ Standard Chart, indicates a potential further decline to ₦1,200.”
According to an expert economist, to achieve better results, it is important to focus on key actions such as refinancing existing debt, managing financial strategies effectively, and avoiding unnecessary distractions like conflicts and insurgencies that can disrupt oil pipelines and impact cash flow.
By Nnaemeka Odenigbo
