Businesses have expressed lower confidence in the economy, with the Overall Confidence Index for the next three months falling by 3.2 index points to 14.5 from 17.7 index points.
This was the highlight of the Central Bank of Nigeria’s (CBN) October Business Expectation Survey (BES), which also revealed a fall in the Overall Confidence Index (OCI) for the current month, next month, and the following six months.
According to the CBN, the OCI for the current month, next month, and next six months declined to 1.4, 4.8, and 21.8 index points in the October BES, compared to 3.2, 6.2, and 29 index points in the September BES.
According to the study, the drop in economic confidence is being driven by firms’ expectations of more naira depreciation before the end of the year.
The CBN stated, “The overall confidence index (CI) on the macroeconomy indicates that businesses were optimistic in October 2024.”
“Respondent enterprises forecast the naira to fall in the current month, the following month, and the next three months. However, they anticipate appreciation in the next six months.
“The top six business constraints are high interest rates, insecurity, high/multiple taxes, insufficient power supply, an unfavorable economic climate, and financial problems.”
“Respondents from all sectors, except the Industry Sector, are optimistic about the business prospects for the current month.
“Most sectors indicated optimism about their own operations throughout the review month. Respondents had an optimistic outlook on the volume of business activities, the volume of total orders, financial conditions, and access to credit during the review month.
“Businesses forecast to hire more workers in November 2024, with the exception of the Construction Sector. According to a sector analysis, agriculture has the best chance of creating jobs and expanding in November 2024.
“Respondents mentioned High interest rates, insecurity and high/multiple taxes as top business constraints for October 2024.”
