Macroeconomic Forecast Nigeria

October 2008 | Macroeconomic Forecasts

BMI View: We have previously argued that the Central Bank of Nigeria (CBN) was holding back the naira from appreciating on the back of large forex inflows from oil receipts. However, with the advent of rapidly falling oil prices, combined with a spike in global risk aversion which has led investors to flock to the dollar, this situation has reversed, and we now believe the CBN is defending the naira from the kind of rapid depreciation which has afflicted many other sub-Saharan African currencies. We have therefore revised our end-08 target to NGN118.90/US$ from NGN115.75/US$, and our end-09 target to NGN120.00/US$.

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