The federal government spent about $8 billion to stabilise the naira, the Chief Executive Officer of Financial Derivatives Company, Bismarck Rewane, has claimed.
Hitherto the naira experienced a free-fall in value against hard currencies.
The recent turn of event in which the naira is stable in foreign exchange market and currently exchange for N1, 500 to a dollar, according to Rewane who also serves on the Board of the Nigerian Economic Summit Group among other entities is not down to market forces but substantial intervention from the government.
This the economy expert disclosed in an interview with Channels Television on Friday.
“Primarily, what we did say and I did say here was that the naira would appreciate by the end of the first quarter in 2025 and everybody thought I was being too pessimistic but really, in reality we got to 1550 precisely.
“We also said that the budget would be passed and it was passed. We also said there would be lowering of interest rates at a particular point in time, that did not happen but most of our projections especially said there would be another bond issue of $2bn, there was a bond issue of $2bn.
“Today after the Central Bank maintained status quo resolutely, the parallel market appreciated to N1,505 to a dollar, by 1.6 per cent but the PPP value of naira which is very technical is still at N1,102.
“Inter-banking interest rates remain flat and the Nigerian Stock Exchange as you can see here actually lost a little bit. Average daily turnover fell. But this is a major thing. You see the naira appreciating very quickly but we say that this is temporary, don’t get carried away. It will reverse itself to stay where there is fair value.
“So I think the important thing is that ever since then, some things have happened. There is the bright side and the dark side. On the bright side, the Nigerian naira has appreciated by 9% in 2025, inflationary pressures are easing and GDP growth is actually positive. Petrol and diesel prices are cooling and the PMI is actually expanding.
“Now on the dark side, money supply growth is at 17% which is relatively high. Interest rates are elevated, borrowing costs are up and ATM and POS fees are up and Telcos and electricity tariffs are up but that is a balanced picture.
“Externally, we are seeing that of course the naira is strengthening but with caution. Let’s not be too hasty, it is going to correct itself because there are many things that are happening. One, the reserves of $42bn came down to $38 point something billion. But we have also borrowed $4bn in bond issues. So when you take a look at that you find that we have actually spent almost $8bn trying to support the naira at current levels,” he narrated.
