Posted by By late Sunday, the Naira had risen sharply versus the dollar, having broken through key resistance levels and been trading below N1,000 in many black market segments.
Amidst increased global geopolitical tensions, this performance is in line with earlier expectations made by Goldman Sachs.
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Goldman Sachs economists predicted that the Naira’s recent upward trend would continue, which might lead to a decline in the exchange rate below N1000/USD in the coming months.
After experiencing significant devaluations since last June, the value of the Naira has recently begun to rise again. This stabilization is largely down to the actions of the Nigerian financial authorities, such as the implementation of strategic foreign exchange interventions and the implementation of successive interest rate hikes, the current target being 24.75%.
At the most recent Monetary Policy Committee (MPC) meeting, a representative from the Central Bank of Nigeria (CBN) noted that the Naira’s recovery from its previous losses was due in large part to the bank’s aggressive monetary policy changes and the introduction of new market tactics.
The geopolitical climate has also had a role in shaping market trends. The dollar gained ground versus its rivals as the latest Iranian attack on Israel caused investors to flee to safety.
Israeli ministers signaled no imminent plans for retribution, which slightly alleviated market anxieties, and the dollar steadied following initial advances.