CBN Publishes Q4 2017 Economic Report

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The Central Bank of Nigeria Quarterly Economic Report is designed for the dissemination of financial and economic information on the Nigerian economy on a current basis. The Report analyses developments in the financial, fiscal, real and external sectors of the economy, as well as international economic issues of interest.

The Report is directed at a wide spectrum of readers including economists and financial analysts in government and the private sector, as well as general readers.


Despite the non-expansionary monetary policy stance of the CBN, growth in the major monetary aggregates, on a quarter-on-quarter basis, trended upward in the fourth quarter of 2017. Broad money supply (M2) rose by 9.3 percent above the level at end-September 2017, on account of, mainly, the increase in foreign assets (net) of the banking system. Similarly, narrow money supply (M1) rose by 9.7 per cent, on a quarter-on-quarter basis, due to the increase in both its currency and demand deposit components. Over the level, at the end, December 2016, broad money supply (M2) grew by 1.7 percent, while narrow money supply (M1), fell by 2.1 per cent.

Developments in banks’ deposit and lending rates were mixed in the review quarter. With the exception of the 7-day and 1-month maturity deposit rates, which rose to 4.55 per cent and 9.12 percent, respectively, at end-December 2017, all other deposit rates of various maturity fell below the levels in the preceding quarter. The
average savings rate remain unchanged at 4.08 per cent, while the average term deposit rate fell by 0.05 percentage point to 8.82 per cent. The average prime lending rate rose by 0.04 percentage point to close at 17.78 percent, while the maximum lending rate fell by 0.07 percentage point to close at 31.11 per cent in the review quarter. Consequently, the spread between the weighted average term deposit and maximum lending rates narrowed to 22.29 percentage points from 22.31 percentage points in the preceding quarter. Similarly, the margin between the average savings and the maximum lending rates narrowed by 0.3 percentage point to 26.56 percentage points. The weighted average inter-bank call rate rose to 24.02 per cent from 18.45 per cent in the preceding quarter.

The total value of money market assets outstanding at the end of the fourth quarter of 2017 stood at N12,122.02 billion, showing an increase of 0.8 per cent, in contrast to 3.0 per cent decline at endSeptember 2017. The development reflected, mainly, the increase in Federal Government of Nigeria (FGN) Bonds outstanding in the review quarter. Transactions on the Nigerian Stock Exchange (NSE) indicated mixed developments.

Federally-collected revenue, at N2,040.59 billion in the fourth quarter of 2017, was 24.0 and 11.9 per cent lower than the quarterly budget estimate and the receipts in the preceding quarter, respectively. The development was due to the shortfall in both oil and non-oil revenue in the review quarter. Federal Government estimated retained revenue and total expenditure was N731.61 billion and N979.05 billion, respectively, resulting in an estimated deficit of N247.44 billion in the fourth quarter of 2017.

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Agricultural activities in the fourth quarter of 2017 were dominated by harvesting of crops, including tubers and grains, as well as preplanting operations for dry season planting. In the livestock subsector, farmers engaged in the fattening of cattle and stocking of broilers in preparation for the festive period. The end-period inflation, on year-on-year and 12-month moving average bases for the fourth quarter of 2017 was 15.37 per cent and 15.50 per cent, respectively.

World crude oil demand and supply were estimated at 97.77 mbd and 97.28 mbd, respectively, in the fourth quarter of 2017. Nigeria’s crude oil production, including condensates and natural gas liquids, was estimated at an average of 1.80 million barrels per day (mbd) or 165.60 million barrels (mb) for the fourth quarter of 2017. The average price of Nigeria’s reference crude, the Bonny Light (370API), was US$62.48 per barrel, compared with US$52.92 per barrel in the preceding quarter.

Foreign exchange inflow and outflow through the CBN amounted to US$14.71 billion and US$8.38 billion, respectively, resulting in a net inflow of US$6.33 billion. Foreign exchange sales by the CBN to the authorized dealers amounted to US$5.08 billion, compared with US$6.49 billion in the preceding quarter. The average exchange rate of the naira vis-à-vis the US dollar at the investor and exporter window appreciated by 0.5 per cent to N360.47/US$, while the rate at the inter-bank segment depreciated marginally by 0.1 per cent to N305.96/US$ at end-December 2017. The external reserves increased by 18.7 per cent to US$39.35 billion at the end–December 2017.

Major international meetings of importance to the domestic economy in the review quarter included: the fourth meeting of the Presidential Task Force on the ECOWAS Monetary Cooperation Programme (EMCP) held on October 24, 2017, in Niamey, Republic of Niger; the 2nd Experts Committee meeting on the Scheme –
Quoting and Trading in WAMZ National Currencies held at the MPlaza Hotel, Accra, Ghana, from November 27 – December 1, 2017; the 2017 Annual Meetings of the Board of Governors of the World Bank Group (WBG) and the International Monetary Fund (IMF) and the Inter-Governmental Group of Twenty-Four (G-24) on
International Monetary Affairs and Developments held in Washington D. C., USA from October 9 – 15, 2017.

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