• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Business

Rencap Africa Analysts say Naira Over Valued by 26%

1 week ago
in Business, Economy, Features, highlights, Home, home-news, latest News
1 min read
0 0
0
21
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

Rencap Africa Analysts say Naira Over Valued by 26%

Nigeria’s naira may be significantly overvalued, raising questions about its sustainability beyond 2025 as import demand recovers and fiscal risks mount.

A new report by Renaissance Capital Africa estimates the naira is overvalued by about 26 percent compared to its 25-year real effective exchange rate (REER) average. That figure jumps out even after adjusting for inflation and GDP rebasing, both of which have improved official optics but may be masking deeper structural imbalances.

“The naira is now the most expensive currency in Africa on a REER basis,” the report said, warning that current levels are unlikely to hold if oil prices stay subdued and imports rise.

While the floating of the naira in 2023–24 helped reset investor confidence and allowed the currency to be more determined by market fundamentals, the analysts argue that the currency’s current strength is no longer justified purely by reforms.

Instead, they attribute the support to a temporary surge in Nigeria’s current account surplus and modest portfolio inflows chasing high bond yields.

The report also flags a discrepancy: FX reserves are falling, despite a projected $14.1 billion current account surplus in 2025, undermining the case for continued naira strength. IMF figures suggest reserves will drop from $40 billion to $36 billion this year.

RelatedPosts

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe

Cyber Security Authority Flags Rising Mobile Data Scam, Cautions Public

Gov’t Reopens Talks With PayPal to Restore Full Service Access in Ghana

Analysts at RenCap Africa caution that as interest rates decline later this year, a move widely expected by markets, credit growth will pick up, fueling import demand and exposing the currency to pressure.

“Currency stability in the second half of 2025 may push overvaluation to 30%,” the report noted. “The outlook becomes trickier from 2026 onward.”

But some economists like Bismarck Rewane, the CEO of Financial Derivative Company (FDC) argue that the naira remained undervalued by as much as 26.82 percent.

Rewane said in a presentation in June at the Lagos Business School breakfast club that the average PPP rate of the naira should be N1,158.50 especially with the US dollar weakening against global currencies 8.7 percent year to date.

This is as Murtala Sagagi, a member of the central bank’s Monetary Policy Committee (MPC) considered the currency “undervalued”, projecting the naira to maintain its rally till the end of the year.

“The value of the naira has been relatively stable even though it is still considered undervalued. It is projected that the naira would appreciate to N1, 450 per US dollar by the end of 2025,” Sagagi said after a May 20 committee meeting, the central bank said in a statement published on its website.

Renaissance Capital Africa also warned of political risks ahead of the 2027 elections. A widening fiscal deficit, driven by pre-election spending, could accelerate external pressures on the naira, especially if oil exports stall below the 2 million bpd threshold.

Despite this, Nigeria’s high-yield debt remains attractive for now, with the analysts maintaining a positive view on local bonds through H2 2025. But the case for owning Nigerian assets, they say, becomes “much more uncertain” heading into 2026.

Source: businessdayng
Via: norvanreports
Tags: nairaRencap AfricaRencap Africa Analysts say Naira Over Valued by 26%

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

No Result
View All Result

Highlights

Financial Sector Assets up 34.6% in 2024 to GHS 525.59 Billion

Banking Sector Soundness Remains Robust in 2024 Amid Strong Profitability, Adequate Capital Buffers

Sha’Carri Richardson Withdraws from US Trials Following Arrest

From Singuluma to El Kaabi: Can CHAN 2024 Unleash the Next Hat-trick Hero?

Ghana to Welcome King’s Baton Relay on August 8 Ahead of 2026 Commonwealth Games

RMA Demands Public Inquiry into Unibank Collapse, Slams AG’s Decision to Drop Charges

Trending

Features

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe

August 2, 2025

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe The Ghana Airports Company Limited (GACL) has officially...

Cyber Security Authority Flags Rising Mobile Data Scam, Cautions Public

August 2, 2025

Gov’t Reopens Talks With PayPal to Restore Full Service Access in Ghana

August 2, 2025
Bank of Ghana

Financial Sector Assets up 34.6% in 2024 to GHS 525.59 Billion

August 2, 2025

Banking Sector Soundness Remains Robust in 2024 Amid Strong Profitability, Adequate Capital Buffers

August 2, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.