Judging IMF Tea Leaves


Saturday, April 13, 2018 /11:03PM / Proshare Research

Quantitative variables  

Unlike 2016 where severe shocks from declining oil prices and productivity affected the macro path of the nation forcing the fund to adjust its base case scenario. In 2018, the fund seems to be comfortable with the existing base line, admitting that the recovery will go on. We thus take into consideration the following:


·        Escalation in  protectionism

·        Rising policy uncertainty as geopolitical tension remain  

·        Hike in Fund rates

·        Weakness in the  European bank still linger

·        Presence of undercapitalized banks

·        Re-emergence of shale oil production

·        Farmers and headmen clashes


·  Improvement in State and local government finance, but fiscal capacity still remain diminished to their previous levels

·     Improved oil productivity

·    The global economy is growing in sync

·    The uncertainty of an election year and the policy inertia 

Although the funds growth forecast in 2017 was in tandem with actual outcome; inflation caved inwards beyond the funds projection of 17.5%. Thus the fund projects the following in 2018:

·     Growth to hit 1.9% on the back of  non-oil  and oil sector performance of 1.1% and 10%

·     Expect public investment to lag from 2.7% of GDP to 2.3% of GDP  growth

·    Private investment to shoot up from 9.8% of GDP to 10.5% of GDP,  still relatively lower than the pre-recession period

·    Investment tick from 13.5% of GDP to 13.8%  of GD

·     Current account to remain static at 1% of  GDP

Policy- Objective

·        Scaling up Revenue
·        Monitoring price movement
·        Addressing income inequality
·        Implementing a structural reform that accommodates growth
·        Enhancing resilient and further improving the efficiency of the banking sector
·        Address infrastructural deficit 


Download Full Report Here

Proshare Nigeria Pvt. Ltd.

Related News

1.       Nigeria and the Failure to Boost Foreign Direct Investment

2.       We See Headline Rate Falling Again to 12.5% YoY in April 2018 - FBNQuest

3.       March 2018 Inflation Falls Sharply to 13.34% Despite Easter Celebrations

4.      Inflation Slows Sharply on the Swing of Base Effects

5.      March CPI Registers Fourteenth Consecutive Decline

6.      Another Large Injection of Portfolio Monies

7.      Headline Inflation Drops to 13.34% in March 2018; 0.99% Lower Than February 2018 Rate

8.     The Economic Cost of Social Insecurity in Nigeria

9.      FGN’s N2.7trn Promissory Notes to Its Creditors - Impact on Liquidity and Interest Rates

10.  Toward a Healthier Current Account

11.   Inflation to Plunge Further to 13.5% in March – FDC

12.  Nigerian Economy is on Track to Post an Improved Growth in Q1 of 2018 - GTI Capital


Related News