December 24, 2020/CBN
1.0 Highlights
•Respondent firms expressed pessimism on the macro economy.
•Respondents’ outlook on volume of business activity, average capacity utilization,volume of total order, and financial condition(working capital) were positive.
•Respondent firms identified insufficient power supply, unfavourable economic climate, competition, high interest rates, unclear economic laws, financial problems,unfavourable political climate, access to credit,insufficient demand, lack of equipment,lack of materials input,and labour problems as major factors constraining business activity in December 2020.
•Respondent firms expect the Naira to depreciate in the current month and next month but appreciate in the next 2 months and next 6 months.Inflation level is expected to rise in the next 6 and 12 months, while borrowing rate is expected to rise in the current month, next month, next 2 months and the next 6 months.
2.0 Introduction
The December 2020 Business Expectations Survey was conducted online from December 7-11, 2020with a sample size of 1050 businesses nationwide. A response rate of 91.3per cent was achieved and the sample covered the agric./services1, manufacturing, wholesale/retail trade and construction sectors(Fig. 1a, Table 1). The respondent firms were made up of small, medium and large corporations covering both import-oriented and export-oriented businesses (Figs. 1b and 1c, Table 1).
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