Macroeconomic Report & Economic Updates
February 26, 2016
Nigeria Economic Update (Issue 9)
The naira depreciated by 8.2 percent from
N305/$ on February 5th, to N330/ $ on February 12th 20166. The apex body identified the
increased domestic demand for forex to pay for foreign medical treatments and
schools fees (15 percent of total demand) 7 as the main drivers. As
a result, the apex bank is considering to discontinue the provision of forex for
payment of medical bills and school fees abroad and to re-channel the forex
towards the manufacturing sector of the economy. With the continuous
depreciation of the naira, and the CBNs resistance from calls to devalue the
currency, the options for alternatives measures seem to be diminishing.
Related
Nigeria Economic Update (Issue 1)
The
external reserve increased week-on-week by 2 percent to $26.3 billion on
January 6, 2017. The increase was likely triggered by continued
marginal rise in crude oil price, which moderated oil revenue in the review
week. The recent rise in crude oil price is likely to be maintained in the
short term given the recent oil production cut deal by OPEC members. Thus, the Nigerian
government should target short term increase in crude oil production to fully
take advantage of Nigerias exemption from oil production cut and potential
rise in oil prices.