• Expect Naira to depreciate further in Q3

By Babajide Komolafe

The Central Bank of Nigeria, CBN, has said that business enterprises are optimistic there would be improvement in the economy in the next six months.

The CBN stated this in its Business Expectation Survey, BES, report for July.

The report however showed that businesses expect the Naira to depreciate in the third quarter of the year.

According to the CBN the report was based on of 1,600 business enterprises nationwide operating in the Industry, Services and Agriculture sectors, with

98.9 per cent of the firms responding.

The report said: “Respondents indicated optimism on 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 rate,

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 underreview. Respondents also opined that the current inflation rate of 34.19 is too high.”