Fitch Ratings has revised the outlook on Nigeria’s long-term foreign-currency Issuer Default Rating to stable from negative and affirmed the IDR at ‘B’.
The international rating firm disclosed this in its report on Wednesday entitled ‘Fitch revises Nigeria’s outlook to stable, affirms at ‘B’.’
The revision of the outlook reflected a decrease in the level of uncertainty surrounding the impact of the global pandemic shock on the Nigerian economy, it said.
Part of the report read, “Oil prices have stabilised, global funding conditions have eased and domestic restrictions on movement have started to be relaxed.
It said a six per cent depreciation in March of the investor and exporter exchange rate at which most foreign currency transactions were carried out fell short of fully correcting the naira’s appreciation by about 35 per cent in real terms between mid-2016 and February 2020.
Fitch report said steep real appreciation had been driven by persistent double-digit inflation, which had offset gains from the devaluations in 2016 and 2017.
It added that the CBN had achieved progress towards its stated goal of unifying the exchange rate, following a cumulative 19 per cent two-step devaluation of the ‘official’ exchange rate, which was mostly used for the government’s and the oil sector’s FC transactions.