Godwin Emefiele, Governor of the Central Bank had previously promised not to devalue the Naira but declining macro-economic variables which include weakening oil prices, depleting foreign reserves, weakening fiscal buffers, among other factors, made it almost impossible for the naira to maintain its status quo.
Hence, naira was devalued in November 2014 by 8 per cent to 160-176 target band from the N150-N160 that it was previously.
Furthermore, banks benchmark interest rate was also increased by a 100 basis points to 13 per cent.
According to the report, a further devaluation of the naira seems inevitable despite this shift in fiscal policy because of the current macro-economic realities.
Chairman of the Association of Issuing Houses of Nigeria (AIHN), Mr Victor, stated that countries like Japan and China devalued their currencies to make their economy more attractive to investors, saying their focus on technology and industrialisation had helped to stabilise their currency overtime.
“A devalued naira to N200 or more would do it. There will be enough naira in the real estate and other sectors. If we are able to grow properly, we will outgrow inflation just as the Asian tigers did in the 80s. Whether we like it or not, we are going to have to devalue again soon,” he said.