Nigeria likely to devalue naira this year, central bank on hold

Nigeria will devalue its currency, the naira, later this year in an effort to improve liquidity and close the gap between the official and exchange parallel markets, a Reuters poll found on Wednesday.
That expectation by seven of the nine economists polled this week comes even though Central Bank Governor Godwin Emefiele has said he would not devalue the naira.
"The possibility of a devaluation is certain; the question is the timing," said Aly-Khan Satchu, an analyst and investor at Rich Management in Nairobi.
"They are eventually going to capitulate at some point this year, a similar scenario to Egypt at the end of last year - a big devaluation in the official rate."
Nigeria stubbornly held on to an official peg of 197 naira to the dollar for 16 months, until June of last year, hurting the economy. It subsequently floated the currency but maintained some measures to prevent further weakening. The naira currently trades at 305 per dollar.
Dollar shortages meant the currency fell to close to 500 against the dollar last week on the unapproved open retail market.
Satchu said keeping the currency artificially high is effectively stalling the economy and making investment difficult.
The Central Bank of Nigeria is expected to leave its benchmark interest rate unchanged on Tuesday, and for the rest of the year, at 14 percent to halt rising inflation and support growth, the wider poll of 12 economists also found.