Nigeria EIU Report: Nigeria's Official Exchange Rate Set to Surge to N1,068/$ by 2025

A recent report by the Economist Intelligence Unit (EIU) forecasts a substantial devaluation of Nigeria's official exchange rate to N1,068.3 per US dollar by 2025. The EIU attributes this projection to the widening gap between official and parallel-market rates, coupled with the country's low foreign exchange reserves. Despite efforts by the Central Bank of Nigeria (CBN) to address forex illiquidity and clear backlog, challenges persist.

The report suggests a potential 38.5% loss against the US dollar in 2025, impacting inflation rates. The EIU indicates that the CBN lacks the necessary firepower for an effective currency float, anticipating periodic devaluations and an unstable exchange-rate regime. Challenges in efficiently disbursing foreign exchange and forex backlog clearing efforts continue, affecting investor confidence in Nigeria's economy.