Reviews & Outlooks | |
Reviews & Outlooks | |
4431 VIEWS | |
![]() |
Wednesday, January 17, 2018 /09:30AM /
CardinalStone Research
Global - Global economy to strengthen in 2018
The IMF projects global GDP growth at 3.7 percent even as
expectations for global economy remains upbeat. Domestic consumption, on the
back of improving consumer confidence as well as tax cuts effect, is expected
to further catalyze growth in the United States in 2018. More so, with
inflation expected to rise further in line with- or beyond- expectations, more
Fed rate hikes are anticipated during the year.
The Euro Area looks to shrug off economic repercussions of Brexit
towards ensuring steady growth for the region. Likewise, emerging market
economies are expected to further consolidate on recovery experienced in 2017
and possibly be a key driver for global growth in 2018
Nigeria Economy - the party just started!
Nigeria's Gross Domestic Product is projected to consolidate
further in 2018 following the rebound from economic recession in 2017. Rising
consumer confidence indicates positive outlook for private consumption which is
expected to be a key driver for growth. Furthermore, oil price stability
together with the observed decline in oil production disruptions, presents
opportunities for a more sustainable growth.
These, alongside moderation in FX demand, increased foreign direct
inflows and a relatively liquid FX transaction window, further translates into
positive implications for the domestic currency. More so, growth is expected to
feed off an expansionary fiscal theme, with particular pivot towards
infrastructure building and a reduction in the high unemployment rate.
This rides on expectations of government's capability to meet a
significant portion of its funding needs through increased oil revenues, higher
tax collections and increased, yet sustainable, external borrowing. Likewise,
monetary policy is projected to ease following expectations of continued
moderation in inflation.
Financial Markets - Improving optimism positive for equities
Following the rally in the equities market in 2017, we expect
momentum to remain positive given optimistic outlook for macro-economic
fundamentals. Nevertheless, we are cautious in our excitement as any
disappointment in corporate results, or political tension in the pre-election
year, can spook the market and cause it to falter. Other than these concerns,
we expect the bulls to ride the year.
Our outlook for the fixed income market hinges on the pace of
inflation decline. In the short to mid-term, however, we expect a sustained
decline in yields in the face of the much anticipated monetary policy
easing.
*prices as at January 16, 2018
Download
Full Report Here
Related
News