Macroeconomic Report & Economic Updates

January 22, 2016

Nigeria Economic Update (Issue 5)

All Share Index (ASI) and Market
Capitalization declined by 13 percent to close at 23514.04 points and N8.09
trillion respectively at the end of the trade session on January 15.
The huge drop in the Index, representing a 3-year low, led to the introduction
of the Index Circuit Breakers Rule. While this policy measure may
prevent huge losses in the stock market, rising concerns about macroeconomic
stability in Nigeria may significantly increase the level of volatility in the
stock market. This may have substantial adverse implications for investors in
the Stock Exchange.

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Nigeria Economic Update (Issue 50)

Crude oil price experienced a mixed week from November 18 to November 25, 2016. Specifically, OPEC basket price and Brent crude price fluctuated, to a daily average of $44.6 (from $42.33)and $48.3 (from $46.86)per barrel respectively. The present oil volatility is as a result of sell-offs, attributable to speculations/fears of an insufficient production cut by OPEC (in its bid to control oversupply) - a deal scheduled for its next meeting on November 30th 2016. This speculations have arisen due to the reluctance of major OPEC member country (Saudi Arabia) to participate in the potential oil cut dealwhich could exert a downward pressure on oil prices. However, oil prices should rise if OPEC members agree to the oil cut deal. Irrespective of the outcome of the meeting, Nigeria is exempted from the potential crude oil cut. Thus, it will be optimal for the government to act quickly to address the insurgence in the Niger Delta region, in order to raise domestic oil production as much as possible.