Macroeconomic Report & Economic Updates

August 5, 2016

Nigeria Economic Update (Issue 33)

The naira depreciated by 4.3 percent to a
record low of N313/$ at the interbank market segment on July 29, 2016.Precisely, the lack of liquidity in all FX market segments continues to weaken
the naira. In order to increase FOREX liquidity, moderate inflationary
pressures, encourage capital inflows and support the naira, the CBN may need to
increase the supply of FOREX in the interbank market while simultaneously
mopping up idle funds through the sale of securities.

Download Label
March 13, 2018 - 4:00 am
application/pdf
506.47 kB
v.1.7 (stable)

Related

 

Portfolio Diversification Between Developed And Less Developed Economies

This study examines the hedging effectiveness of portfolio investment diversification between developed and developing economies; with focus on the Nigerian stock asset vis--vis the stock assets of the United States (US) and United Kingdom (UK). Its main contribution is in the analysis of optimal portfolio diversification using optimal portfolio weight (OPW) and optimal hedging ratio (OHR). Empirical findings show that the OPW and OHR are low, which indicates impressive potential gains from combining Nigerian stock assets in an investment portfolio with US and UK stock assets. In addition, exchange rate volatility is found to pose stern limitation on the potential benefits of this portfolio diversification arrangement. It is therefore recommended that the monetary authority in Nigeria should pursue policies towards reducing exchange rate volatility to the barest minimum. This will possibly attract more investors from developed economies who might be willing to combine Nigerian stock in their investment portfolio to minimize portfolio risk.

CPI And Its Component And Premium Motor Spirit

CPI and its Component: Changes in inflation rate has mostly been driven by the Core sub-index component. Precisely, in 2016 Q1 and Q2, the rising cost of import, electricity and transport drove inflat