Business operators in various sectors expressed pessimism in Nigeria’s economy in the month of June, a new report by the Central Bank of Nigeria (CBN) revealed on Thursday.
The central bank’s Business Expectations Survey for June 2020 was conducted by the CBN statistics unit between 8-12 June with a sample of 1050 businesses nationwide to feel the pulse of small, medium and large corporations (both import-oriented and export-oriented) with regards to their confidence in the economy.
The report, which covered the agric/services, manufacturing, wholesale/retail trade, and construction sectors, said “respondent firms expressed pessimism on the macroeconomy.”
At -24.3 index points, the overall confidence index implied respondents’ pessimism on the entire macroeconomy.
It went further to state that “respondents’ outlook on the volume of total order, financial conditions (working capital), access to credit and average capacity utilisation all remained negative, but optimistic on the volume of business activities.”
The firms surveyed identified inadequate power supply, competition, high interest rate, financial problems, unfavourable economic climate, unclear economic laws, low demand, unfavourable political climate, poor access to credit and lack of equipment as major factors constraining business activities.
Respondent firms, according to the document, expected naira to depreciate in the current month but improve in value in the second half of 2020.
“Inflation level is expected to rise in the next six and 12 months, while the borrowing rate is expected to rise in the current month, next month, next two months and next six months,” it stated.
But respondents were hopeful in their outlook for July with a confidence index of 31.8.
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