Report: Bank of America Economist Predicts 20% Devaluation of the Nigerian Currency in 2023
A Bank of America economist, Tatonga Rusike, has said the Nigerian currency is overvalued by as much as 20% and will likely be devalued in 2030. The remarks by the economist came just days after the currency’s exchange rate reportedly touched a new low of just under 750 naira for every U.S. dollar on the parallel market. Currency Fair Value Analysis According to a Bank of America economist, Tatonga Rusike, the Nigerian currency, which has officially stayed below the 450:1 mark since May 2021, is overvalued by 20% and he expects it to be devalued by as much in 2023. In his October 18 note to clients, Rusike reportedly said the bank came to this conclusion after examining indicators like the central bank’s real effective exchange rate and the widely used parallel market exchange rate. In addition to using the two exchange rates, the bank also used its own currency fair value analysis to determine the extent of the naira’s overvaluation. Meanwhile, Rusike’s devaluation comm...