The Nigeria’s naira is now the world’s best-performing currency among those tracked by Bloomberg in April.
The naira, which has depreciated against the dollar over the past seven months, started reversing declines last month to make it the world’s best-performing currency in April 2024 among those tracked by Bloomberg.
The naira has rallied 12% against the dollar in April, adding to its 14% surge in March.
The currency has gained almost 40 per cent, aided by a mix of factors, including two successive interest-rate hikes in February and March of a combined 200 basis points
The Monetary Policy Committee (MPC) had in its first meeting in 2024, increase of monetary policy rate (MPR) from 18.75 per cent to 22.5 per cent and cash reserve ratio (CRR) from 32.5 per cent to 45 per cent
Rising from its two-day meeting on March 26, the MPC again raised the Monetary Policy Rate (MPR) to 24.75 percent, representing 200 basis points increase.
The continued rally in the naira may persuade monetary policymakers to maintain the key rate when they meet April with the aim of ensuring inflation eases to below 10 per cent midpoint of its target range.
The naira could also extend gains in the official market in the coming days, provided policymakers stay on track, according to a Goldman Sachs Group Inc. economist.
Goldman Sachs had in March forecast the naira to hit N1,200 in 12 months as the CBN’s reforms deliver results.
