Central Bank of Nigeria has said that businesses operating in Nigeria have expressed optimism on their confidence in Nigeria economic prospect in 2019. According to the report “majority of the respondent firms expect the Naira to appreciate in the current, next and the next twelve months respectively as their confidence indices stood at 23.0, 31.9 and 44.6 points. The CBN said that respondent firms expect borrowing rates to rise in current, next and the next twelve months as the confidence indices stood at 20.0, 6.7 and 7.6 points, respectively. According to the apex bank survey report “respondents’ expectation of inflation rate in the next six months and twelve months in January stood at 11.7 and 11.6 percent respectively. Respondent it further said were optimistic of better economic conditions as their expectations on the growth of the economy rose steadily in the short run with an index of 35.5, 42.7 and 56.4 points for the current month, next six months and next twelve months respectively.
According to the CBN Business Confidence survey for the month of January published in its website “At 25.9 index points, respondents expressed optimism on the overall confidence index (CI) on the macro economy in January 2019. The businesses outlook for February 2019 showed greater confidence on the macro economy with 62.1 index points. The optimism on the macro economy in the current month was driven by the opinion of respondents from services (13.0 points), industrial (10.9 points), wholesale/retail trade (1.5 points) and construction sectors (0.5 points). Whereas the major drivers of the optimism for next month were services (35.0 points), industrial (20.0 points), wholesale/retail trade (5.4 points) and construction sectors (1.7 points).
“The positive outlook by type of business in January 2019 were driven by businesses that are neither import- nor export-oriented (17.6 points), both import- and export-oriented (4.2 points), import-oriented (3.5 points) and those that are export-related (0.6 points). All sectors expressed optimism on own operations in January 2019. Respondents from the services sector expressed the greatest optimism on own operation with an index of 8.0 points. Comparatively, the construction sector expressed high optimism as the index rose from 0.0 point in the previous month to 0.6 points in the current month Respondents’ outlook on the volume of total order and business activity in January 2019 remained positive, as the index stood at 16.0 and 16.4 points, respectively. Similarly, respondents’ outlook on financial conditions (working capital) and average capacity utilisation was optimistic, as the indices stood at 15.6 and 22.5 points respectively. Respondents were positive on access to credit in the review month, with an index of 2.4 points.
“The positive outlook in the volume of business activities (67.4 index points) and employment (27.6 index points) indicated a favourable business outlook in the next month. The employment outlook index by sector showed that the industrial sector (29.3 points) indicates the highest prospects for creating jobs, followed by services (28.9 points), construction (25.0 points) and wholesale/retail trade sector (13.8 points). The analysis of businesses expansion plans by sector next month showed that the construction sector indicates higher disposition for expansion with an index of 42.9 points followed by services and industrial sectors with 41.2 and 11.4 index points, respectively. The surveyed firms identified insufficient power supply (61.6 points), high interest rate (60.0 points) unfavourable economic climate (55.3 points), unclear economic laws (53.5 points), financial problems (52.9 points), unfavourable political climate (50.8 points), insufficient demand (45.7 points) and competition (44.2 points) as the major factors constraining business activity in the current month.