Pre-MPC: High Stakes, Tough Choices

The Nigerian Monetary Policy Committee (MPC) will be sitting for its 6th and last session for the year from 23rd and 24th of November, 2015. The meeting is coming against the backdrop of concerns surrounding FX rate amid calls for further devaluation of the local unit, slow GDP growth, unrelenting inflationary pressure, robust liquidity levels in the financial system as well as the increasing expectation for a FED rate hike in December 2015.

Inauguration of Fiscal Cabinet...Policy Clarity Tops Expectations

The much awaited inauguration of the Federal Executive Council (FEC) finally took place on Wednesday, 11th 2015 with the ministerial-designates allocated portfolios. As expected, the number of ministers was pruned down to 36 from 42 whilst some ministries were merged to give a total of 25 ministries from 29. This aligns with the objectives of the government to reduce administrative overheads to conserve resources in a period of declining oil prices, which resulted in a 30.7% Y-o-Y decline (to N3.5tn) in revenues accruing to the federation account in the first half of the year.

Securing the Future of Nigerian Pensioners

Unarguably, the process of entrenching a pragmatic and sustainable pension scheme in Nigeria has been challenging. Successive colonial and post-colonial administrations had come up with various schemes as part of efforts to fashion out a sustainable pension system for both public and private sectors’ workers.

The first public sector pension scheme in Nigeria was the Pension Ordinance of 1951, which retroactively took effect from Jan. 1, 1946.

The Economic Task Ahead as Buhari Inaugurates New FEC Tomorrow

President Muhammadu Buhari is expected to officially inaugurate a new Federal Executive Council tomorrow –Wednesday, November 11, 2015.

Before the commencement of the inaugural session of the council, the ministers-designate will take their oaths of office in the Council Chambers of the Presidential Villa.

According to the presidency, the swearing-in ceremony will begin promptly at 10:00 Hours and the ministers-designate are expected to be seated in the Council Chambers by 09:30 Hours at the latest.

Macroeconomic Challenges Weigh on Companies Scorecards

The year 2015 has been characterized by a cocktail of macroeconomic challenges which trailed the decline in crude oil prices, and the political and policy uncertainties that shaped direction of the economy so far in 2015. This is reflected in the trend of key macroeconomic indicators such as the slowing economic growth (Real GDP growth slowed to a 10-year low of 2.4% in Q2:2015), the steadily rising inflation (31-month high at 9.4% in October 2015), weak fiscal spending, hawkish monetary policy and foreign exchange constraints.

Lending to the Real Sector

The first 9 months of this year have been characterized by macroeconomic headwinds. Added to this, the banking industry faced hawkish regulations that generally constrained banks' capacity to create risk assets and trade within a fully functional foreign exchange market. Furthermore, the directive by the President on the full implementation of the Treasury Single Account (TSA) tightened liquidity in the financial system and inevitably jerked up interbank money market rates -- having reached year highs of over 100.0%.

Fitch: Nigerian Insurance Fundamentals Intact despite Weakening Economy

Fitch Ratings says in a new report that the Nigerian insurance industry will continue to expand, despite recent economic headwinds and significant structural challenges, Reuters reports.

The industry has experienced declining growth rates in recent years, albeit from a high base. However, a number of leading insurers have maintained strong premium and balance sheet growth over the past three years.

Africa Slowdown Should Not Stop Infrastructure Plans -World Bank

Africa should press ahead with plans to develop its transport and energy networks despite a recent slowdown in GDP growth because better infrastructure is key to long term development, the head of the World Bank said on Friday.

To that end, governments need to maintain macro-economic stability to attract capital that remains willing to commit to the continent even though investment in emerging markets is at its lowest level in around 35 years, said Jim Yong Kim.

Diminishing Real Return Mounting Pressure on Investment

The National Bureau of Statistics (NBS) released its September 2015 Consumer Price Index (CPI) report during the week. In this report, Y-o-Y headline inflation inched further higher to 9.4% to reach its 31-month high (since February 2013). After staying flat at 9.2% Y-o-Y between June and July, the 0.1% M-o-M rise in September inflation marked the 8th successive increase in inflation so far in 2015.