The Fitch Ratings has applauded the economic reforms introduced by President Bola Tinubu’s administration, stressing that they appear to be yielding positive results.
Since assuming office in May 2023, President Tinubu has implemented various reforms, including the removal of fuel and electricity subsidies, as well as naira devaluation.
Fitch Ratings, a global ratings agency, hinted that these reforms have led to a revision of Nigeria’s economic outlook from stable to positive, according to Reuters.
The agency in the statement explained that “the reforms have reduced distortions stemming from previous unconventional monetary and exchange rate policies.”
The agency attributes this revision to the reduction of distortions resulting from previous unconventional monetary and exchange rate policies.
However, Fitch also identifies persistently high inflation and an unstable currency market as significant short-term challenges facing Nigeria.
Despite this, the agency acknowledges efforts by the Central Bank of Nigeria to address these challenges. These efforts include the increase of its monetary policy rate by 600 basis points and a directive to banks to raise their minimum capital.
The measures aim to enhance resilience and strengthen the country’s financial system.
As a result, Fitch has rated Nigeria at “B-” within the junk territory. This rating indicates a positive outlook for the country’s economic future.
