Why Naira Will Be Stronger In 2024 – Rewane

Why Naira Will Be Stronger In 2024 – Rewane

According to Rewane, “Inflation is likely to drop in 2024 and could go as low as 17 per cent in 2025. Once inflation begins to decline, the exchange rate naturally appreciates because the exchange rate pass-through starts slowing down.”

However, he noted that inflation would continue to rise early next early due to market reforms and persistent currency volatility on the black market. “Base effects are expected to kick in by mid-year, with inflation moderating to an average of 23.6 percent in 2024 from an average of 24.4 percent in 2023.The decline in inflation will naturally lead to exchange rate appreciation,” he said.

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“There were higher energy prices with diesel price up by 34.01 per cent to N1050 per litre (year-on-year), fuel price up by 233 per cent to N630 per litre (year-on-year), while money supply growth went up 36 per cent (year-on-year) to N67.18 trillion in September,” he said.

He conducted a thorough analysis of essential factors such as Gross Domestic Product (GDP) growth, inflation rates, and employment trends, providing valuable insights into the economic landscape.

Furthermore, he emphasized the substantial contribution of investment in Nigeria as a key driver of the country’s GDP.

Rewane also acknowledged the interconnectedness of the global economy, underscoring the various international factors that could impact the economic outlook for Nigeria in the coming year. This encompasses considerations of geopolitical events, trade dynamics, emerging market trends, and the influence of artificial intelligence (AI).

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While he dwelt on AI and the rapid change the world is facing, he backed up his point, stating: “The world has changed; artificial intelligence and social media have made it easy. Now, there are no queues at banks, because all you need is your app.”

He added: “Investors are expected to deepen positions in securities that offer higher yields and companies with quality cashflows and realistic earnings goals.”

Further, he highlighted a salient point for investors. He stated: “Before you invest in a country, be sure that the indigenes are also investing in that country.”

Parthian Partners organized the session as part of its commitment to providing value-added services to clients, serving as a valuable resource for businesses, investors, and policymakers in need of strategic guidance for the upcoming year.

Additionally, Seun Dosunmu, the Head of Research at Parthian Securities, a subsidiary of Parthian Partners, offered insights into the equities market. He highlighted trends that are expected to be replicated in 2024 and advised investors to anticipate a high-interest rate, recapitalization of the banking industry, capital raising by some listed companies, mergers and acquisitions in the banking sector, as well as prospective energy capacity increase, among other factors.

Dosunmu also mentioned potential listings for the next year, including Dangote Foods, Dangote Refinery, and NNPCL.

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