IMF Says Naira Still Undervalued by 25.6% Despite FX Reforms
By Aboki Forex —
The International Monetary Fund has declared that the Naira remains undervalued by 25.6 percent. This is even as Nigeria continues its foreign exchange reforms.
In its latest Article IV consultation report on Nigeria, the Washington based lender said its Real Effective Exchange Rate model shows the local currency is still trading below levels justified by the country's economic fundamentals.
The IMF assessment suggests that despite recent policy changes, the Naira has not yet reached its fair value. The report adds to ongoing debate about the pace and impact of Nigeria's FX liberalisation efforts.
Analysts say the finding could put pressure on the Central Bank of Nigeria to allow further depreciation or tighten monetary policy to support the currency.