Businesses Foresee Naira Depreciation in Q1 of 2025

In its Business Expectation Survey Report for November 2024, the CBN said despite this expectation, there are several businesses which expressed optimism about the macroeconomic environment.

The report noted that firms’ outlook on the volume of business activities, financial conditions, access to credit, volume of total orders and average capacity utilisation, were pessimistic.

“The overall confidence index (CI) on the macroeconomy indicated that businesses were optimistic in November 2024.

“Businesses expect the Naira to depreciate in the current month, next month and next 3 months but appreciate in the next 6 months,” the report said.

“The optimism on business outlook in the current month is driven by the opinion of respondents from all the sectors.

“The Construction Sector expressed optimism on its operations in the review month.

“The outlook of respondents on the volume of business activities, the volume of total orders, financial conditions, and access to credit were negative in the review month. the volume of business activity respondents expressed optimism on the volume of business activity for the next month and subsequent periods under review,” it added.

The report also showed that businesses hope to employ more workers in the month of December 2024 with the agriculture sector having the highest prospect for expansion.

Meanwhile, the CBN in its latest Consumer Expectation Survey Report said that consumers were pessimistic about the macro economy in November.

According to the CBN report, households projected a rise in the cost of transportation, rent, car/vehicle, house purchase, and medical expenses this month.

The report showed that 61.1 per cent and 57.6 per cent of respondents perceived that prices of non-durable and durable household items, though high, will keep declining this month and next month respectively.