• Friday, March 01, 2024
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Naira on path to fair value but tough days ahead, says Rewane

Naira on path to fair value but tough days ahead, says Rewane

The naira is on the path to its fair value against the dollar, according to Bismarck Rewane, CEO of Lagos-based consulting firm, Financial Derivatives Company Ltd.

Rewane, who spoke in an interview on Channels Television, said the naira is undergoing transition and not jinxed as being speculated in some quarters.

“I don’t think the naira is jinxed. It is just a currency in transition. And you can see that in 2016, it was N499 per dollar. As of Monday, it was N1,468. It had dropped to N1,531 per dollar sometime last week and started finding its way back,” Rewane said.

“So, we have tough days ahead. But the point is that you have to look at it in the context of the currency in transition to weigh its fair value,” Rewane said.

The respected economist said “the problems are structural, some are transit. So we have to understand it in that context. But you know that the fundamental problem with the naira is that any country that has high inflation and cost of living crisis will always have a weak currency.

“To address that, you have to look at it from a broad perspective. It is not one silver bullet that can solve all problems,” he said.