A survey has revealed that at 58.7 index points, the business outlook for August 2018, showed more confidence in the Nigerian economy.
The Central Bank of Nigeria (CBN) revealed this in its July 2018 Business Expectations Survey (BES), posted on its website.
The respondent firms were made up of small, medium and large organisations covering both import- and export-oriented businesses.
The drivers of the optimism this month were services (34.8 points), industrial (16.5 points), wholesale/retail trade (4.6 points), construction (2.8 points) sectors.
However, it stated that at 13.6 index points, respondents’ overall confidence index (CI) on the macro economy in July 2018 declined when compared with the level of 34.7 index points recorded in June 2018.
“Businesses expressed less optimism on own operations in July 2018 when compared to the previous month.
“However, respondents from services and wholesale/retail trade sectors expressed relatively more optimism on own operations in the current month with indices of 0.3 and 2.7 respectively when compared with 7.6 and 0.9 reported in June 2018, respectively,” it stated.
Respondents’ outlook on the volume of total order and business activity in July 2018 was less optimistic, as the index stood at 4.6 and 3.5 points, respectively when compared to 16.4 and 16.1 points, respectively recorded in the previous month.
Similarly, respondents’ outlook on financial conditions (working capital) and average capacity utiliSation declined, as the indices stood at 2.2 and 10.0 index points, respectively when compared with the 11.7 and 23.4 points, respectively recorded in June 2018.
Respondents were pessimistic on access to credit in the review month, with an index of -3.5 points.
“The positive outlook in the volume of business activities (66.2 index points) and employment (24.2 index points) indicated a favourable outlook in the next month.
“The employment outlook index by sector showed that the services sector (28.8 points) indicates the highest prospects for creating jobs, followed by wholesale/retail trade (22.2 points), construction (20.5 points), and industrial (17.1 points), sectors,” it added.
An analysis of businesses with expansion plans by sector in the next month showed that the wholesale/retail trade indicates greater disposition for expansion with an index of 31.8, followed by the services and construction sectors with 28.7 and 8.8 index points respectively.