A new exchange rate has been projected for 2025 amid growing expectations of the naira’s strong performance.Economist believes that the naira will be helped by higher oil earnings and improved manufacturingThere is also an optimistic outlook for GDP growth and inflation due to expected increased food production and forex stability
Henzodaily.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends
The Nigerian Economic Summit Group (NESG) has forecasted a massive naira appreciation to an average exchange rate of N1,300 to the US dollar in 2025.
The optimistic projection was stated in its 2025 economic outlook, released on Thursday, January 2025.
NESG believes the naira will bounce back
Photo credit: NESG
Source: Getty Images
According to NESG, the exchange rate forecast is based on increased foreign exchange earnings driven by higher crude oil sales, revitalised manufacturing output from the oil refining sub-sector, and improved agricultural productivity.
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The group noted that Nigeria, a largely crude oil-based economy, is expected to benefit from stable global demand and enhanced local production, boosting export revenues.
NESG is optimistic about the Nigerian economy
The private think-tank group also projected Nigeria’s real GDP growth to rise to 5.5% in 2025, provided comprehensive stabilisation reforms are implemented.
These reforms address cross-sectoral and sector-specific challenges, enabling broad-based sectoral growth.
NESG noted that this would depart from the limited growth seen in 2024, where only four out of 20 key sectors recorded growth rates exceeding 5%, BusinessDay reports.
Additionally, inflation is expected to decline substantially to 24.7% in 2025, reflecting improved macroeconomic stability.
NESG attributed this forecast to effective coordination between fiscal and monetary policies, enhanced forex market stability, and increased agricultural output.
Improved security in farming regions and better access to farmlands are anticipated to boost food production, reduce scarcity and ease price pressures.
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NESG stated:
“Increased food production will alleviate scarcity and help stabilise food prices, which remain a key driver of inflation in Nigeria.”
NESG on CBN policies
Speaking at unveiling the outlook for 2025, Olaniyi Yusuf, Chairman of NESG, highlighted the naira’s steep depreciation in 2024, where the official exchange rate fell by 41.4% to close at N1,536.5 per US dollar.
However, he lauded the Central Bank of Nigeria’s (CBN) commitment to policies fostering price discovery and narrowing the gap between official and parallel market rates.
Yusuf said:
“The optimal pathways to stabilisation policies envision a consolidation of monetary, fiscal, trade, and regulatory frameworks, paving the way for economic transformation in the next twelve months.”
FG launches new programme to help farmers in Nigeria
Ealier, Henzodaily.ng reported that T]the federal government has a new initiative that it believes will help boost food security in the country.
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The initiative, which is the brainchild of the Federal Ministry of Agriculture and Food Security, is called ‘Operation Empty The Stores.’
The Ministry of Agriculture believes the project will help farmers across the country increase food production.
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Source: Henzodaily.ng