August 17, 2020

Nigeria Economic Update (Issue 28)

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The inflation rate for the month of June rose to 12.56 percent from 12.40 percent in May1. The rise in inflation was driven by a rise in all components of the headline index, as food sub-index rose by 0.14 percent to 15.18 percent and the core sub-index rose by 0.01 percent to 10.13 percent. On a state level, headline inflation was highest in Bauchi (15.02%), Sokoto (14.88%) and Ebonyi (14.60%), while Cross River (10.95%), Lagos (10.78%) and Kwara (10.03%) recorded the slowest rise in headline inflation. The rise in the core sub-index was driven by an increase in the price of medical and hospital services, as well as motor cars and passenger transport by road which is intuitive given the upward pressure on the demand for these services. Given that the borders are still closed and restrictions to inter-state travel remain, we expect the demand for local medical services and road transport to remain high, thus causing suppliers to raise price and further increasing inflation. The monetary authorities will have to address the inflationary pressure while providing loans to the private sector with low interest rates to mitigate against the pandemic.

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Nigeria Economic Update (Issue 20)

The Naira maintained slight appreciation against the dollar in the review week. At the parallel market, the value of the Naira appreciated week-on-week by 1.6 percent to exchange at N380/$ on May 19, 2017. In addition, inter-bank market rate appreciated slightly by 15kobo to N305.45/$. The appreciation in both segments of the market are favorable effects of the CBNs continued forex supply in the week under review (In a bid to further ease forex liquidity, the CBN pumped a total of $457.3 million on May 15, 2017).

Nigeria Economic Update (Issue 5)

Recently released media highlights show that Nigeria has dropped in terms of macroeconomic indicator rankings in 2018. With a headline index of 2.77, Nigeria is ranked 158th globally out of 181 countries five places lower than the previous year rankings. Indicators suggest that Nigeria is presently behind 28 other African countries, and just ahead of only 4 West African countries (Mauritania, Togo, Niger and Guinea Bissau). 

Nigeria Economic Update (Issue 22)

Power sector analysis shows a decline in power generated by 15.07 percent from a peak of 3,424 mw to 2,908 mw between May 8, 2016 and May 15, 20169. The declining power supply is attributable to vandalism of pipelines and gas shortages, which has a debilitating effect on power generation. As part of the efforts by the Federal Government to improve power supply in the country, the Bank of Industry (BoI) is currently funding intervention projects to provide alternative source of energy (solar) in rural areas across the country10. Since the major problem facing power generation in the country is gas shortages, the government should make concerted efforts to combat vandalism.