Hurried approach to stabilise naira won’t work, Peterside tells FG

The founder of Stanbic IBTC, Atedo Peterside, has said only sustained stability can ensure the naira appreciates against the dollar and other foreign currencies.

Peterside explained that the hurried approach being adopted by the Federal Government to ensure the naira gains a stronger position against other currencies is not the best for the country’s legal tender to appreciate.

Speaking on Channels Television’s Politics Today on Thursday, the investment banker insisted that hurrying to make the currency appreciate without proper stability won’t work out.

“I will be fair to this government, they inherited the exchange rate problem and what they have been doing is trying to manage it. Recently I would have thought, let’s get some stability around N1,300 or N1,400, don’t be in a hurry to appreciate the exchange rate.

“Going to sell dollar to bureau de change at N1,000, N1,050, those guys will turn round two weeks later and sell it at N1,400, N1,500 and they go away laughing. What’s the point of that?

“It’s better to have some stability they can sustain, keep between N1,300 and N1,300 which looks to be the natural equilibrium band today, keep it there for a while, build up your reserve to let confidence come back.

“So stop trying to appreciate the naira in a hurry, it’s not going to work,” Peterside said.

April 29, 2024, that the naira has demonstrated signs of strengthening against the United States dollar, appreciating by N125 to reach N1,275/$1

The new rate represents a 9.8 per cent increase when compared to N1,400 to a dollar it traded at the close of trading activity the previous week.

Also, dollar supply in the official foreign exchange market reached a substantial sum of $7.3bn in the months of March and April, findings by The PUNCH have shown.

This is as the naira rebounded against the United States dollar to N1,390 per dollar at the official market and steadied at 1,340/$ at the parallel market, popularly called the black market on Monday.

Meanwhile, a new Bloomberg report said Nigeria’s naira experienced a reversal in its recent gains, emerging as the world’s worst-performing currency over the last month.

The development places increased pressure on the Central Bank of Nigeria to continue raising interest rates, the report added.

The naira has depreciated to 1,466.31 against the dollar, marking its weakest level since March 20.

This decline is attributed to the local scarcity of the US currency, with only $84 million available on Thursday, half of the previous day’s supply.