Nume Ekeghe

The December 2024 Business Expectations Survey (BES) conducted by the Central Bank of Nigeria (CBN) has revealed a wave of optimism among respondent firms regarding the macroeconomic outlook.

Precisely, the BES report posted on the CBN’s website yesterday, further revealed that businesses anticipate a steady appreciation of the Naira in the coming months. Businesses expect the Naira to appreciate in the current month, next month, and the next three months, with significant appreciation projected within the next six months.

The optimism was underpinned by expectations of exchange rate improvements, heightened business activity, and increasing total orders as the economy heads into 2025.
According to the survey, the overall confidence index for the macroeconomy reflected positive sentiment across all sectors, with the agriculture sector emerging as the most confident.

The sector recorded the highest levels of optimism and the most aggressive expansion plans for January 2025, demonstrating its role as a key driver of economic recovery.

Specifically, macroeconomic projections suggested a 17 percent appreciation in December 2024, rising to 17.8 percent in January 2025, 25.9 percent in three months, and reaching 29 percent by mid-2025.
The projection aligned with the CBN’s recent forex reforms, which have been instrumental in stabilising the market and restoring confidence among market participants.

 The survey also highlighted broad optimism about macroeconomic conditions. Businesses expressed confidence in improved financial conditions, increased orders, and higher levels of activity across key sectors. Respondents also expect inflation rates to stabilise or decline over the next six months, bolstering hopes of price stability as the economy gains momentum.

The insights underscored the critical role of the BES in shaping Nigeria’s monetary and fiscal policies. Conducted regularly, the survey provides a valuable gauge of business sentiment and helps the apex bank design targeted policies to foster economic growth.
CBN Governor Olayemi Cardoso, who spoke at the Nigerian Economic Summit Group (NESG) Economic Outlook recently, had elaborated on the tangible outcomes of the CBN’s forex reforms.

“We are seeing the positive outcomes of our foreign exchange reforms, which have not only boosted market transparency but also restored investor confidence.
“The Naira is becoming more competitive, offering significant opportunities for exports and local production,” he said.

 The Naira closed yesterday at N1,533.26 to the dollar at the official CBN window, marking the second-best closing rate since the launch of the Nigeria Foreign Exchange Market System (NFEMS) portal, with the best recorded on December 10, 2024. While on the parallel market, the Naira appreciated by N10, closing at N1,640 to the dollar.

Cardoso had highlighted the success of CBN reforms in reducing the disparity between bureau de change (BDC) rates and official rates, fostering a more stable forex market.
 “We will continue to strengthen our mechanisms to ensure market participants adhere to best practices. Those who fail to conform will be appropriately dealt with,” he had emphasised.

The governor also pointed to recent initiatives, including the introduction of non-resident BVN accounts, as part of the CBN’s efforts to deepen engagement with the Nigerian diaspora.
“I am very confident that we are going to see a very positive outcome. My discussions with the diaspora show that everyone is committed to doubling the levels we are at,” Cardoso stated.

Reflecting on the broader impact of the reforms, Cardoso highlighted a key milestone achieved in 2024 with over $6 billion in foreign capital inflows and external reserves exceeding $40 billion.
He noted that these figures signal renewed investor confidence in the Nigerian economy and a solid foundation for sustained growth.
“Good things are ahead on the foreign exchange side,” the governor concluded. 

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