The Monetary Policy Committee (MPC) is set to have its 5th meeting of the year on the 18th and 19th of September, 2017. As has been the case with all meetings held so far in 2017, we expect the committee members to maintain status quo on policy rates as they sit to deliberate on recent happenings in the global and domestic landscape next week. However, we expect emphasis to be placed on the need to consolidate gains in the FX market whilst urging for more fiscal-monetary policy coordination to sustain recent improvements in domestic macroeconomic fundamentals.
During the week, the National Bureau of Statistics (NBS) released Nigeria’s Q2:2017 Gross Domestic Product (GDP) report which confirmed consensus view that macroeconomic fundamentals are improving and growth would turn positive after five consecutive quarters of contraction. The report showed GDP expanded by 0.55% Y-o-Y in Q2:2017 - much in line with our estimate of 0.6% - compared to a contraction of 0.9% Y-o-Y in Q1:2017 (revised downward from earlier estimate of –0.55%) and decline of 1.5% Y-o-Y in Q2:2016.
During the week, the National Bureau of Statistics (NBS) published its quarterly capital importation report for Q2:2017. Expectedly, the data published reflected improved investor confidence in the Nigerian economy since the turn of the second quarter against the backdrop of improving macroeconomic condition and FX policy reforms implemented by the Central Bank of Nigeria (CBN) in April 2017. This culminated in a rebound in capital inflows in the period to a level last seen in Q3:2016 when the CBN first announced a move to a flexible FX market structure.
In what could be considered a strategy to address Nigeria’s rising debt servicing cost brought about by high domestic interest rate environment and sizeable increase in fiscal deficit over the years, the Federal Executive Council (FEC) on Wednesday this week approved a restructuring plan for public debt by way of refinancing maturing Treasury Bills obligations with cheaper and longer term external debt.
Unemployment in Nigeria, sub-Saharan Africa's largest economy, is running at more than 14 percent and climbing; in South Africa, the second largest economy, it is over 27 percent. For youth in both places, it is far more, Reuters reports.
This may seem bad enough, but according to International Monetary Fund calculations the sub-Saharan Africa region's jobs travails are in danger of reaching uncharted territory in less than two decades.
That is, unless the economies can create jobs for their burgeoning, young population.
As global business takes stock of Brexit and headline-grabbing US policy decisions, working visas are ripe for reform. Some countries are already benefiting, as Erika Morphy reports.
At the beginning of May, Indian IT giant Infosys announced that over the next several years it would open four tech hubs in the US, hiring some 10,000 Americans in the process. It was a startling concession from the company, which has long been accused of job-stealing by the US. Through it all, Infosys had never blinked, much less revealed country-specific hiring plans.
The Monetary Policy Committee (MPC) held its fourth meeting for the year on the 24th and 25th July, 2017 and much in line with our expectation, status quo was maintained on all key rates as the committee noted that the recent gains recorded in the economic landscape remain fragile and could be disrupted if adequate fiscal and monetary policies are not implemented to complement the recovery. Consequently: