Economy

Business, Consumer Expectations Improve in Nigeria

Published

9 years ago

17/07/2017

By FSDH Research

The Business Expectations Survey (BES) and the Consumer Expectations Survey (CES) Reports that the Central Bank of Nigeria (CBN) published for Q2, 2017 show that confidence of both the firms and consumers about the Q3, 2017 and the next 12 months has improved.

The BES shows that the respondents’ overall confidence index on the macro-economy in Q2, 2017 was less pessimistic when compared with the level recorded in Q1, 2016.

The major drivers of the improved optimism in Q2, 2017 were services, wholesale/retail trade, industrial and construction sectors. The respondent firms identified the following as major business constraints: insufficient power supply, financial problem, high interest rate, unfavourable economic climate, competition, unclear economic laws, and unfavourable political climate.

Most of the surveyed firms expect the value of the Naira to appreciate against the US Dollar in the next two quarters. The report also shows that businesses with expansion plans are in the following sectors: wholesale/retail trade, services, construction and industrial.

The BES added that respondent firms expect inflation rate and interest rate to moderate in the next two quarters.

The CES shows that the respondents’ overall confidence outlook moderated in Q2, 2017.

According to the survey, some respondents attributed the improved outlook to the increased confidence in the economy. Despite the improved confidence the overall outlook was negative, majority of the respondents ascribed this development to a decline in their net income leading to draw-down on savings/getting into debt.

The consumer outlook for the next quarter and that of the next 12 months were positive. The outlook is attributed to the anticipated improvement in the Nigerian economic conditions, expected increase in net household income and expectation to save in the next 12 months.

On the expectation of consumer expenditure, the survey says more households across the country expect some increase in their expenditure on basic commodities and services in the next 12 months. Most consumers expect to spend a substantial amount of their income on food and other household needs, education, savings, purchase of consumer durables, medical expenses and investment.

Nevertheless, they do not plan to spend on large ticket items such as purchase of car/motor vehicle and house.

Most surveyed consumers expect the prices of goods and services to increase in the next 12 months. The major drivers are: house rent, education, medical care, transport and electricity. On the consumer buying outlook, consumers believe Q2, 2017 was not the ideal time to buy consumer durables like motor vehicle and house.

It also added that the next 12 months are not the best time to buy items such as furniture, gas cooker, refrigerator, air conditioners, television and other durables. However the next 12 months seem to be an ideal time to buy big-ticket items like motor vehicles and house.

Although consumers expect inflation rate to rise in the next 12 months, they expect exchange rate to appreciate and interest rate (borrowing rate) to drop.

We note that there are still some challenges in the economy that need to be addressed.

However, our review of the Nigerian economy shows that the worst performance may be over. Thus the economy is ready for a recovery. We are of the view that inflation rate will decline for the rest of the year 2017 (but still in double digits).

We also expect the Monetary Policy Committee (MPC) of the CBN to adopt a more accommodating monetary policy stance when there is sustainable stability in the foreign exchange rate and inflation expectation is properly anchored within the level that is not growth retarding. Such a change in the monetary policy stance will lead to a drop in the interest rates (both deposit and lending) and yields on the fixed income securities.

The Federal Government of Nigeria (FGN) needs to address the challenges in the power sector in order to reduce firms’ operating cost and increase the spendable and investible income of consumers. Other areas that need attention in order to improve business and consumer confidence are the political and policy uncertainties in the country.

Economy

Aradel, Red Star Express, Others Crash NGX by 0.69%

Published

4 minutes ago

19/03/2026

Dipo Olowookere

By Dipo Olowookere

The Nigerian Exchange (NGX) experienced a pullback of 0.69 per cent as a result of profit-taking by investors, with shares in the banking and energy sectors mostly affected.

Data harvested by Business Post showed that the energy index was down by 4.58 per cent during the session, and the banking space lost 2.14 per cent.

They brought down the All-Share Index (ASI) by 1,402.56 points to 201,156.85 points from 202,559.41 points and shrank the market capitalisation by N900 billion to N129.126 trillion from N130.026 trillion.

Customs Street ended in red at midweek despite three of the five key sectors finishing in green. The consumer goods counter expanded by 1.19 per cent, the industrial goods index improved by 0.46 per cent, and the insurance sector grew by 0.43 per cent.

Red Star Express declined by 9.98 per cent to N25.70, Aradel Holdings went down by 9.68 per cent to N1,210.30, Presco lost 9.30 per cent to trade at N1,701.10, Living Trust Mortgage Bank crashed by 8.40 per cent to N4.80, and DAAR Communications dropped 7.50 per cent to end at N1.85.

On the flip side, Secure Electronic Technology gained 10.00 per cent to settle at N1.32, Guinness Nigeria rose by 9.92 per cent to N423.20, John Holt increased by 9.72 per cent to N11.85, Sovereign Trust Insurance surged by 9.57 per cent to N2.06, and Linkage Assurance chalked up 9.33 per cent to trade at N1.64.

Investor sentiment was weak yesterday after the bourse registered 33 price gainers and 38 price losers, indicating a negative market breadth index.

Market participants bought and sold 6.1 billion stocks valued at N130.1 billion in 58,562 deals compared with the 1.8 billion stocks worth N88.1 billion traded in 62,654 deals on Tuesday, representing a shortfall in the number of deals by 6.53 per cent, and a spike in the trading volume and value by 238.89 per cent and 47.67 per cent apiece.

The most active equity on Wednesday was eTranzact with 5.2 billion units sold for N24.3 billion, Wema Bank exchanged 111.4 million units worth N3.1 billion, Coronation Insurance transacted 96.4 million units valued at N303.9 million, Dangote Cement traded 75.2 million units for N56.5 billion, and Access Holdings exchanged 61.5 million units valued at N1.6 billion.

Economy

Naira Reverses Gains at NAFEX, Sheds N8.96 to Quote N1,353/$1

Published

38 minutes ago

19/03/2026

Adedapo Adesanya

By Adedapo Adesanya

The Naira stumbled against the Dollar in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Wednesday, March 18, by N8.96 or 0.67 per cent to trade at N1,353.00/$1, in contrast to the previous day’s rate of N1,344.04/$1.

Also, the local currency weakened against the Pound Sterling in the spot market at midweek by N6.06 to sell for N1,801.93/£1 compared with Tuesday’s value of N1,795.87/£1, and lost N4.75 against the Euro to quote at N1,556.22/€1 versus the preceding day’s N1,551.46/€1.

However, the Nigerian currency gained N2 against the greenback yesterday at the GTBank forex desk to close at N1,363/$1 versus the N1,365/$1 it was exchanged for a day earlier, and traded flat in the parallel market at N1,395/$1.

Nigeria’s external reserves fell by $178 million over three consecutive international payments recorded by the Central Bank of Nigeria (CBN), settling at $49.83 billion from $50.008 billion, indicating that there have been some interventions in the FX market for stability and liquidity.

While the wider outlook for the Naira is positive, potential disruptions to global oil supply have increased volatility in energy markets and could spike inflation with higher oil prices.

In the cryptocurrency market, Bitcoin (BTC) slipped below $71,000 on Wednesday as Federal Reserve Chair Jerome Powell flagged rising oil prices amid the war in Iran as a new inflation risk. It sold at $70,538.58.

The US central bank held interest rates steady as expected, but during his post-meeting press conference, Mr Powell acknowledged that the recent surge in energy prices is already feeding into the central bank’s outlook.

He said rising oil prices “for sure showed up” in policymakers’ higher inflation outlook for this year, lifting their forecast to 2.7 per cent from 2.4 per cent.

Further, Ethereum (ETH) lost 6.3 per cent to trade at $2,178.56, Cardano (ADA) fell by 6.1 per cent to $0.2714, Dogecoin (DOGE) dropped 5.7 per cent to close at $0.0096, Solana (SOL) dipped 4.8 per cent to $89.83, Ripple (XRP) slumped by 3.8 per cent to $1.46, and Binance Coin (BNB) declined by 3.7 per cent to $648.61.

However, TRON (TRX) appreciated by 0.4 per cent to $0.3037, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 each.

Economy

Brent Hits $112 as Iran Escalates Attacks on Middle East Energy Facilities

Published

2 hours ago

19/03/2026

Adedapo Adesanya

By Adedapo Adesanya

Brent crude moved higher by 4.27 per cent to $112.00 per barrel on Wednesday as Iran attacked several energy facilities across the Middle East, creating a major escalation in its war with the United States and Israel.

Also, the US West Texas Intermediate grew by 2.73 per cent to $98.95, as the Middle East conflict continues to escalate, and energy infrastructure is targeted across the Gulf, as Iran hit energy infrastructure across the Middle East in retaliation for earlier strikes on its South Pars gas field.

Qatar confirmed that Iranian missile strikes had caused “extensive damage” around the Ras Laffan industrial complex, the world’s largest liquefied natural gas (LNG) facility and a cornerstone of global gas supply.

Meanwhile, the United Arab Emirates (UAE) suspended operations at its Habshan gas facility after missile-related incidents, with debris from intercepted projectiles reportedly affecting additional energy infrastructure, including the Bab oil field.

Saudi Arabia, Kuwait, Iraq, and Bahrain continue to be targeted by Iran, with Saudi Arabia reporting that air defences had destroyed a total of 19 drones in the Eastern Province and four missiles launched toward Riyadh.

Earlier on Wednesday, Iran issued an evacuation warning for ⁠several energy facilities across Saudi Arabia, the UAE and Qatar, saying they would be targeted by strikes “in the coming hours.”

Shipping also remained under threat, with the UK’s maritime security agency reporting that a vessel east of the Strait of Hormuz caught fire after being struck by an “unknown projectile.”

The war has halted shipments via the Strait of Hormuz, which handles 20 per cent of global oil and LNG supply. Total oil output cuts in the Middle East are estimated at 7 million to 10 million barrels per day, or 7 per cent to 10 per cent of global demand.

To ease worries, the administration of US President Donald Trump on Wednesday announced a 60-day waiver of the Jones Act shipping law, temporarily allowing foreign-flagged vessels to move fuel, fertiliser, and other goods between US ports.

It is also working on measures that could help slow the surge in fuel prices in the US, but are unlikely to have much of an effect on global energy prices.

In Iraq, the North Oil Company said crude exports from Iraq’s Kirkuk fields to Turkey’s Ceyhan port ⁠have resumed via pipeline, after Iraq and the Kurdistan Regional Government agreed to restart flows. The company said exports would resume with an initial capacity of 250,000 barrels per day.

The US Energy Information Administration (EIA) said crude inventories rose by 6.2 million barrels to 449.3 million barrels in the week ended March 13.