The Central Bank of Nigeria has said that business owners are hopeful that in August 2024 and the ensuing six months, the business environment in Nigeria will improve.
The apex bank’s Business Expectations report, which was made public on Wednesday, states that company owners anticipate improved business performance in August, with an optimism index of 7.6 points.
CBN said that the business optimism index was expected to be 19.3 points in the next three months and 30.7 points in the next six months.
“Similarly, the outlook for next month, next three months, and next six months all indicated optimism with indices of 7.6, 19.3, and 30.7 points, respectively,” the report read.
It clarified that the macroeconomic outlook will be bolstered by the following industries: manufacturing, non-market services, agriculture, market services, energy, gas & water supply, mining, and quarrying.
It stated, “The expected drivers for the optimism on the macroeconomy in the next month are Mining, Quarrying, Electricity, Gas & Water Supply (35.3 points), Agriculture (9.9 points), Market Services (7.8 points), Manufacturing (6.3 points), and Non-Market Services (4.8 points).
“Respondents indicated optimism on the overall business outlook in July 2024, as the business conditions in Nigeria are expected to improve. This optimism is driven by the opinion of respondents from the Agriculture Sector.
“Respondents’ outlook for the next month, next 3 months, and next 6 months all indicated optimism. The positive outlook in the volume of business activities of the firms in the next month implied improved prospects for employment in the same period. The sector with the highest prospect for employment is the Agriculture Sector, followed by the Industry and Services sectors.
“The respondent firms opined that insecurity was the major factor constraining the business activity in July 2024. Other constraining factors are high interest rates, insufficient power supply, and high/multiple taxes. Respondent firms expect the exchange rate to depreciate in all review periods except the next six months. However, they expect the borrowing rate to rise in all the periods under review. Respondents also opined that the current inflation rate of 34.19 is too high.”
The total confidence index in July 2024 was 0.1 points, a decrease of 3.0 points from the confidence levels attained in June 2024.
