Nigeria To Further Cut Down GDP Estimate For 2015
Nigeria is set to lower its prediction for 2015 economic growth once again, after slashing the country’s economic growth projection to 5.5 percent in January, from an earlier 6.4 percent. This came as a result of lower oil revenues caused by the fall in global oil prices.
The head of the National Bureau of Statistics, Yemi Kale told the Reuters Africa Investment Summit on Tuesday that he did not expect a reduction of more than 1 percent in the 5.5 percent forecast. He also added that final figures will be released by half-year.
“Because of the changes in the macro-variables … we are not sticking with those forecasts any longer. The exchange rate, crude oil forecast have changed,” Kale told Reuters by telephone. According to him the growth rate will possibly drop further to around 4 percent, “but again other sectors may compensate for the drop in oil prices and the depreciation.”
Amidst the election fever and attempts by the Central Bank of Nigeria to save the Naira, the currency suffered the biggest monthly decline in more than five years last month. The Naira traded at 200 to the dollar in February which led to the scrapping of CBN’s weekly Forex auctions, in a de facto devaluation.
Mr Kale anticipates that inflation in Africa’s biggest economy will edge up to around 9 percent, the upper end of the central bank’s target, from its January forecast of 8.78 for 2015. “The price of commodity (oil) has gone down, but the exchange rate weakness has cancelled the impact on the inflation,” he said.
The fall in oil prices has put a lot of pressure on the Naira, despite data on imported capital for the past two years indicating a significant amount of foreign investments flowed into the country.
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