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Goldman Sachs Group Inc, the leading global investment banking, securities and investment management firm, has released its latest report on Nigeria's economic realities wherein it declared naira as the best-performing currency in April 2024.
The report, compiled by Goldman Sachs' economists projected that, with the current upward swing of the naira in the foreign exchange market, the currency may exchange below ₦1,000 per dollar in the coming months.
The firm, in its March projection, said the naira would appreciate to N1,200 per dollar within the next 12 months.
However, it disclosed that the local currency surged 12% against the greenback, adding to a 1% increase in March.
According to the firm, the rally was supported by capital inflows and consecutive interest rate hikes, helping to recover from significant losses following two devaluations since last June.
Speaking in an interview with Bloomberg on Friday, April 12, 2024, an economist at Goldman Sachs, Andrew Matheny, commended the Central Bank of Nigeria (CBN) for "continuing to hold the line."
“This probably can run further; we would see an extension of the move to 1,000 and maybe even sub-1,000,” Matheny said.
Goldman Sachs' forecast comes amid a strong rally of the naira at both parallel and official sections of the foreign exchange market.
On Monday, April 8, 2024, the local currency exchanged for ₦1,230.61 at the official market and ₦1,200 at the parallel market.
In the past months, the apex bank has introduced several policy measures aimed at injecting stability into the FX market.
At the same time, the CBN continues to intervene by selling FX to Bureau De Change (BDC) operators at a revised rate, leading to further gains for the naira.