CENTRAL BANK OF NIGERIA Second Quarter

2024
ECONOMIC REPORT

Classified as Confidential
ABOUT THE REPORT

The Central Bank of Nigeria (CBN) Economic Report presents economic

developments in Nigeria, for dissemination to the public. The Report, which
is published on a monthly and quarterly basis, provides insights on current
developments in the real, fiscal, financial, and external sectors of the
Nigerian economy, as well as, on global issues that impact the domestic
economy. In addition, it reflects the policy initiatives of the CBN in pursuit
of its mandate.

The Report is targeted at a wide range of readers, including economists,

policymakers, financial analysts in the government and private sectors,
and the public. Free download of the Report, including current and past
issues are available from the CBN website: www.cbn.gov.ng. All inquiries
concerning the Report should be directed to the Director, Research
Department, Central Bank of Nigeria, P.M.B. 187, Garki, Abuja, Nigeria.

i
Content
SUMMARY ..................................................................................................... 1
1.0 GLOBAL ECONOMIC DEVELOPMENTS ............................. 3
1.1 Global Economic Activity ................................................... 3
1.2 Global Inflation .................................................................. 6
1.3 Global Financial Markets ................................................... 8
1.4 Global Commodity Market ............................................... 10
1.5 Monetary Policy Stance ............................................................ 14
2.0 DOMESTIC ECONOMIC DEVELOPMENTS....................... 16
2.1 Real Sector Developments ........................................... 16
2.1.1 Sectoral Performance ...................................................... 17
2.1.2 Inflation ........................................................................... 22
2.1.3 Socio-Economic Developments ....................................... 30
2.1.4 Energy Sector and Electricity .......................................... 30
2.1.4.1 Domestic Crude Oil Market Development ..................... 30
2.2 Fiscal Sector Developments ......................................... 33
2.2.1 Federation Account Operations ....................................... 33
2.2.2 Fiscal Operations of the Federal Government ................. 36
2.3 Monetary and Financial Developments........................ 41
2.3.1 Monetary Developments.................................................. 41
2.3.2 Sectoral Credit Utilisation ................................................ 46
2.3.3 Financial Developments .................................................. 47
2.4 External Sector Developments ..................................... 58
2.4.1 Current and Capital Account ........................................... 58
2.4.2 Financial Account ............................................................ 64
2.4.3 External Debt .................................................................. 65
2.4.4 International Investment Position (IIP) ............................. 66
2.4.5 External Reserves ........................................................... 66
2.4.6 Foreign Exchange Flows through the Economy .............. 67
2.4.7 Exchange Rate Movement........................................................ 69
3.0 Economic Outlook......................................................... 71
3.1 Global Outlook ............................................................................ 71
3.2 Domestic Outlook ....................................................................... 72

ii
Tables
Table 1: Global Purchasing Managers’ Index (PMI)....................... 4
Table 2: Indices of Average World Prices of Nigeria’s Major
Agricultural Export Commodities in US$ for Second Quarter 2024,
Jan. 2010=100 ............................................................................ 14
Table 3: Central Bank Policy Rates (per cent) .............................. 15
Table 4: Index of Industrial Production (Q42022 – Q22024) ........ 19
Table 5: Index of Mining Production (Q42022 – Q22024)............ 20
Table 6: Index of Manufacturing Production (Q42022 – Q22024) 21
Table 7: Index of Electricity Production ....................................... 32
Table 8: Federally Collected Revenue and Distribution to the...... 35
Table 9: FGN Retained Revenue (₦ Billion) ................................. 36
Table 10: Fiscal Balance (₦ Billion) ............................................. 38
Table 11: Money and Credit Growth over preceding December (per
cent)........................................................................................... 45
Table 12: Sectoral Credit Allocation ............................................ 46
Table 13: Nigeria Exchange (NGX) Limited Sectoral Indices........ 53
Table 14: Listings and De-listings on the Nigerian Exchange
Limited in Q22024 ...................................................................... 55
Table 15: Selected EMEs Currency Rates to the US dollar............ 70

Figures
Figure 1: PMIs in Selected Advanced Economies ........................... 5
Figure 2: PMI in Selected Emerging Market and Developing
Economies .................................................................................... 6
Figure 3: Inflation Rates in Selected Advanced Economies (per
cent)............................................................................................. 7
Figure 4: Inflation Rates in Selected EMDEs (per cent) .................. 8
Figure 5: Key Global Stock ............................................................ 9
Figure 6: 10-year Government Bond Yields for Selected Countries
.................................................................................................. 10
Figure 7: Total Global Crude Supply and Demand ....................... 11
Figure 8: Quarterly Crude Oil Prices (US$ per barrel) .................. 12
Figure 9: Price Changes in Selected Metals (per cent) for Q2 2024
.................................................................................................. 13
Figure 10: Real GDP Growth Rate, Q22021- Q22024, Year-on-Year
.................................................................................................. 17
Figure 11: Sectoral Growth Rate of Real GDP, Q22021- Q22024 . 18
Figure 12: Top 16 Subsectors with largest Contribution to GDP
Growth and their Growth Rates (per cent) in Q22024 ................. 21
iii
Figure 13: Subsectors with Least Contribution to GDP Growth and
their Growth Rates (per cent) in Q22024 .................................... 22
Figure 14: Headline, Food and Core Inflation (year-on-year) ....... 22
Figure 15: Inflation Pervasiveness .............................................. 23
Figure 16: Inflation Momentum.................................................. 24
Figure 17: Measures of Underlying Inflation ............................... 25
Figure 18: Component Drivers of Core Inflation .......................... 26
Figure 19: Contribution of Processed Food and Farm Produce to
Food Inflation ............................................................................. 27
Figure 20: Component Drivers of Food Inflation.......................... 28
Figure 21: Nigeria’s Crude oil production and OPEC quota (mbpd)
.................................................................................................. 31
Figure 22: Gross Revenue Outturn and Benchmark (₦ Billion)..... 34
Figure 23: Federal Government Expenditure (₦ Billion)............... 37
Figure 24: FGN External and Domestic Debt Composition ........... 39
Figure 25: Domestic Debt Stock by Instrument as at end-March
2024 ........................................................................................... 40
Figure 26: External Debt Stock by Instrument as at end-March
2024 ........................................................................................... 40
Figure 27: Developments in Reserve Money (₦ Trillion) and Money
Multiplier ................................................................................... 42
Figure 28: Q-o-Q Growth in Reserve Money................................ 42
Figure 29: Composition of Currency-in-Circulation ...................... 43
Figure 30: Consumer Credit Outstanding .................................... 47
Figure 31: Transactions at the Standing Facility Window ............ 48
Figure 32: Open Market Operation ............................................. 48
Figure 33: Primary Market NTBs (₦ Trillion) ............................... 49
Figure 34: Primary Auctions of FGN Bond ................................... 50
Figure 35: Developments in Short-term Interest Rates ................ 50
Figure 36: Trend in Average Term Deposit and Lending Rates .... 51
Figure 37: Aggregate Market Capitalisation and All-Share Index 52
Figure 38: Quarter-on-Quarter Changes in Per cent for Sectoral
Indices........................................................................................ 53
Figure 39: Volume and Value of Traded Securities on the NGX ... 54
Figure 40: Current Account Balance (US$ Billion) ........................ 59
Figure 41: Import by Classification in Per cent ............................ 60
Figure 42: Share of Service Out-Payments in Per cent ................. 60
Figure 43: Share of Services Receipts in Per cent ......................... 62
Figure 44: Primary Income Balance (US$ Billion) ........................ 63
Figure 45: Secondary Income Balance and Remittances Inflow ... 64
Figure 46: External Reserves and Months of Import Cover .......... 67
iv
Figure 47: Foreign Exchange Transactions through the Economy
(US$ Billion) ............................................................................... 68
Figure 48: Turnover in the I&E Foreign Exchange Market ........... 69
Figure 49: Selected EMEs Currency Values to the US dollar ......... 70

v
ECONOMIC REPORT, SECOND QUARTER 2024

SUMMARY
The global economy showed resilience in Q22024, as robust service and
manufacturing performances drove the Global Composite Purchasing Managers'
Index (PMI) to 52.90 index points, from 52.30 in Q12024. The performance was
broad based across Advanced Economies (AEs) and Emerging Markets and
Developing Economies (EMDEs) and reflected the improvement in business
conditions worldwide. Global inflation, however, exhibited varied patterns,
influenced by fluctuations in food, energy and transportation costs. Financial
markets presented diverse trends globally, with the bond market continuing its
upward trajectory (following a delayed start to rate cuts by major central banks).
Crude oil spot prices increased in Q22024, primarily driven by rising fuel
consumption in the US. The average spot price of Nigeria's reference crude oil,
Bonny Light, rose by 1.62 per cent to US$86.97 per barrel (pb) in Q22024,
compared with US$85.58 pb in the preceding quarter.

The domestic economy expanded in Q22024, supported by continued investments

in infrastructure and ongoing fiscal reforms. Real GDP grew by 3.19 per cent year-
on-year, an improvement compared with the 2.98 per cent growth in the previous
quarter, and with positive contributions from both the oil and non-oil sectors.
Despite these gains, inflation pressures remained a challenge. Headline inflation
increased to 34.19 per cent in Q22024 from 33.20 per cent in Q12024, driven by
high energy costs, elevated import prices, and persistent structural issues. Food
inflation reached 40.87 per cent, due to higher energy and farm input costs.
Domestic crude oil production fell by 4.51 per cent to 1.27 mbpd, impacted by
ongoing oil theft and illegal refining activities in the Niger Delta region.

The fiscal operations of the Federal Government of Nigeria (FGN) improved, as

federally collected revenue rose by 26.37 per cent compared with the level in the
preceding quarter, though it remained below the benchmark. FGN retained
revenue also rose by 57.66 per cent but fell short of the target by 52.94 per cent.
FGN expenditure grew by 27.79 per cent over the preceding quarter, but was 4.94
per cent below the target. The fiscal deficit expanded by 16.56 per cent due,
primarily, to the 95.95 per cent increase in interest payments. Public debt reached
₦121.67 Trillion (51.22% of GDP), exceeding the 40.00 per cent benchmark in
March 2024.

The financial sector remained stable during the review period. Broad money supply
(M3) expanded by 27.88 per cent to ₦101.35 trillion, driven largely by currency
depreciation and credit expansion to critical sectors. Monetary aggregates
increased due to growth in both net foreign assets (NFA) and net domestic assets
(NDA). However, average banking system liquidity declined, affected by the
implementation of the cash reserve ratio (CRR), activities in open market
operations (OMO), and sales of Nigerian treasury bills (NTBs). The equities market
slowed, as the All-Share Index (ASI) declined by 4.31 per cent, reflecting a shift in
investor preference towards fixed-income securities.

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ECONOMIC REPORT, SECOND QUARTER 2024

The external sector performance improved, on account of a positive current

account balance, driven by higher trade balance and increased remittances. The
financial account recorded a net incurrence of financial liabilities, driven by a rise
in portfolio investment liabilities. External reserves stood at US$34.76 billion,
sufficient to cover 7.89 months of imports for goods and services, or 12.09 months
for goods alone. At the Nigerian Foreign Exchange Market (NFEM), the exchange
rate depreciated to ₦1,385.96/US$ from ₦1,304.72/US$ in Q12024.

Domestic economic growth prospects remain positive in the near term,

underpinned by ongoing reforms and a resilient global economy. However,
persistent inflation pressures and challenges in the oil sector could pose risks to
economic stability.

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ECONOMIC REPORT, SECOND QUARTER 2024

1.0 GLOBAL ECONOMIC DEVELOPMENTS

Global economic activity expanded in the second quarter of
2024, buoyed by robust performances in the services and
manufacturing sectors. The expansion in economic activity was
observed in most Advanced Economies (AEs) and in many
Emerging Markets and Developing Economies (EMDEs).
Inflation dropped in many AEs and EMDEs in Q22024,
influenced, largely, by moderations in food, energy and
transportation costs. Financial markets exhibited diverse
trends in Q22024 across regions and segments. The global
bond market maintained an upward trajectory following
continued tight stance of monetary policy in Q22024, with most
central banks maintaining policy rates at current levels.

1.1 Global Economic Activity

Global economic activity maintained its upward momentum in
Q22024, driven by improvements in the services and
Global manufacturing sectors. Global Purchasing Managers’ Index (PMI)
Economic
Activity rose to 52.90 index points, compared with 52.30 index points in
Q12024, driven by increases in output and new business, along with
accelerated job growth. Economic activity improved in five out of the
six sub-sectors surveyed, with financial services in the lead. Other
sectors that expanded were business services, consumer goods,
and intermediate goods, and consumer services sector. The
investment goods producers, however, experienced a slight
contraction in output.

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ECONOMIC REPORT, SECOND QUARTER 2024

Table 1: Global Purchasing Managers’ Index (PMI)

Q42023 Q12024 Q22024
Composite (Output) 51.00 52.30 52.90
Employment Level 50.50 50.90 51.30
New Business Orders 50.90 52.10 52.00
New Export Business Orders 48.40 49.80 49.60
Future Output 62.60 63.80 62.10
Input Prices 56.10 56.60 56.30
Output Prices 53.50 53.80 52.80

Manufacturing 49.00 50.60 50.90

Services (Business Activity) 51.60 52.40 53.10
New Business 51.80 52.50 52.40
New Export Business 49.30 50.60 50.60
Future Activity 63.40 64.30 63.10
Employment 51.10 51.20 51.50
Outstanding Business 48.40 49.20 50.00
Input Prices 57.50 58.10 56.70
Prices Charged 54.20 54.70 53.00
Source: JP Morgan

Economic activity expanded in most AEs in, driven, mainly by

Economic improved business activity and services. The PMI in the US and
activity in
Spain grew to 54.80 and 55.80 index points in Q22024, respectively,
Advanced
Economies relative to the levels in the preceding quarter, attributed to increased
activity in the services sector. In the UK and Italy, the PMI, at 52.30
and 51.30 index points in Q22024, respectively, showed a slower
expansion compared with 52.80 and 53.50 index points, in Q12024.
This was reflected in the deceleration in business activity in the UK
and services in Italy. In Germany, the growth in the services sector
and increase in job creation drove the PMI to 50.40 index points from
47.70 index points in Q12024. The economic activity in Canada and
France, though in the contraction region, improved to 47.50 and
48.80 index points in Q22024, from 47.00 and 48.30 index points,
respectively, in the preceding quarter. This was because of
improvement in the services sector and new orders in Canada and

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ECONOMIC REPORT, SECOND QUARTER 2024

employment growth in France. In Japan, economic activity, however,

contracted, as the PMI dropped to 49.70 index points in Q22024 from
51.70 index points in Q12024, on account of the fall in new order and
rising input cost.

Figure 1: PMIs in Selected Advanced Economies

55.80
55.30
54.80
60.00

53.50
52.80
52.30
52.10

52.10

51.70
51.30
50.90

50.40
50.40

50.00

49.70

48.80
48.60

48.30
47.70

47.50
47.40

47.00

44.80
44.70
50.00

40.00

30.00

20.00

10.00

0.00
UNITED STATES UNITED GERMANY ITALY JAPAN CANADA SPAIN FRANCE
KINGDOM

Q4 2023 Q1 2024 Q2 2024 50-point Threshold

Source: Trading Economics/Various countries’ websites

The economic activity expanded in most EMDEs in Q22024.

Economic Economic activity gained momentum in China, as the PMI rose to
activity in
EMDEs
52.80 index points, from 52.70 index points in Q12024, due to
increase in new order. In India and Indonesia, PMI decelerated to
60.90 and 50.70 index points in Q22024, respectively, from 61.80
and 54.20 index points in the preceding quarter. This was attributed
to slower expansion in manufacturing and service sector in India, and
concerns over future demand and input price increases in Indonesia.
The PMI also slowed in Mexico and Brazil to 51.10 and 54.10 index
points in Q22024, respectively, from 52.20 and 55.10 index points in
Q12024, following slower growth in manufacturing and rising input
cost.
In Turkey and Russia, economic activities, however, contracted as
the PMI dropped to 47.90 and 49.80 index points in Q22024,
respectively, from 50.00 and 52.70 index points. This was due to fall

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ECONOMIC REPORT, SECOND QUARTER 2024

in production and new orders in Turkey and rising input cost in

Russia. Economic activity in South Africa, improved but remain
within the contraction region, as the PMI increased to 49.20 index
points in Q22024 from 48.40 index point in the preceding quarter,
following subsiding political uncertainty amidst rising input cost.

Figure 2: PMI in Selected Emerging Market and Developing

Economies
70.00
61.80
60.90
58.50

55.70
55.10
54.20

54.10
60.00
52.80
52.70

52.70
52.60

52.20

52.20
52.00

51.10
50.70
50.00

50.00

49.80
49.20
49.00
48.40
47.90
47.40
50.00

40.00

30.00

20.00

10.00

0.00
CHINA INDIA TURKEY SOUTH AFRICA INDONESIA MEXICO BRAZIL RUSSIA

Q4 2023 Q1 2024 Q2 2024 50-point Threshold

Source: Trading Economics/Various countries’ websites

Note: Turkey, Indonesia and Mexico PMIs data were based on manufacturing PMI

1.2 Global Inflation

Inflation moderated in many AEs and EMDEs in Q22024,
influenced, largely by food, energy and transportation costs. In
Global
Inflation the US, inflation fell slightly to 3.23 per cent in Q22024 from 3.27 per
cent in the previous quarter. This was driven by easing food prices,
sustained reductions in costs of vehicles, alongside a slower rise in
energy costs. Inflation in the UK declined significantly to 2.10 per
cent from 3.53 per cent, primarily, due to falling gas and electricity
costs. Germany's inflation fell to 2.27 per cent from 2.53 per cent in
Q12024, reflecting the decrease in goods and energy costs. Italy and
Canada also recorded declines in inflation to 0.80 per cent and 2.77
per cent, respectively, attributed to reductions in transportation costs

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ECONOMIC REPORT, SECOND QUARTER 2024

in both countries. In France, inflation dropped to 2.20 per cent from

2.80 per cent, due to lower food and tobacco prices.

In Japan, however, inflation rose to 2.70 per cent from 2.57 per cent,
driven by significant rises in electricity, food, housing, and
transportation costs. Also, inflation in Spain increased to 3.43 per
cent from 3.13 per cent, mainly, due to upward pressure from
housing and utilities, as the government rolled back some subsidies.

Figure 3: Inflation Rates in Selected Advanced Economies (per

cent)
4.17

4.50

3.73
4.00
3.57
3.53

3.43
3.27
3.27
3.23

3.23

3.20
3.50

3.13
2.90

2.87

2.80
2.77
3.00

2.70
2.57
2.53
2.27

2.20
2.50
2.10

2.00
1.50
0.98
0.95
0.80

1.00
0.50
0.00
UNITED UNITED GERMANY ITALY JAPAN CANADA SPAIN FRANCE
STATES KINGDOM

Q4 2023 Q1 2024 Q2 2024

Source: Trading Economics and Staff Computations

Inflation in EMDEs, showed varied trends. In India, inflation declined

to 4.86 per cent from 5.01 per cent, owing to lower housing costs
and food prices. Similarly, Indonesia experienced a marginal decline
in inflation, falling to 2.78 per cent from 2.79 per cent, driven largely
by lower food prices, housing and health. Inflation also fell in South
Africa and Brazil to 5.20 and 3.95 per cent, respectively, due to the
reduction in the prices of transportation and food.

In contrast, inflation in China, rose to 0.27 per cent from 0.00 per
cent, due to increases in non-food items, clothing, housing, health,
education, and transport. In Mexico, increases in food, beverages,

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ECONOMIC REPORT, SECOND QUARTER 2024

and housing costs pushed inflation to 4.77 per cent from 4.57 per
cent. Russia's inflation rose to 8.23 per cent from 7.60 per cent,
reflecting higher cost of goods and services, while inflation in Turkey
soared to 72.28 per cent from 66.81 per cent, driven by surges in
prices for housing and utilities.

Figure 4: Inflation Rates in Selected EMDEs (per cent)

72.28
80.00

66.81
62.70
70.00
60.00
50.00
40.00
30.00
20.00

8.23
7.60
7.20
5.50
5.40
5.37

5.20
5.01
4.86

4.77

4.71
4.57
4.41

4.31
3.95
10.00 2.78
2.79
2.68
0.27
0.00

0.00
CHINA INDIA SOUTH INDONESIA MEXICO BRAZIL RUSSIA TURKEY
-10.00 AFRICA
-0.33

Q4 2023 Q1 2024 Q2 2024

Source: Trading Economics and Staff Computations

1.3 Global Financial Markets

Financial markets exhibited diverse trends in Q22024 across
regions and segments. Equity markets in AEs recorded increased
performance due to optimism surrounding the artificial intelligence
(AI) tech stocks, moderating inflation pressures and the anticipated
interest rate cuts. The EURO STOXX grew by 1.43 per cent, Japan’s
TOPIX by 2.14 per cent, and UK FTSE 100 by 2.66 per cent. The
resilience of the economy, advancement in AI technology, declining
inflation, and rising investor confidence, boosted stock performance
in the US, particularly, the NASDAQ 100 and S&P 500 which grew
by 7.82 and 3.92 per cent, respectively. The CAC 40 in France,
however, fell by 8.85 per cent, the FTSE-MIB in Italy by 4.59 per
cent, the Nikkei in Japan by 1.95 per cent and the DAX in Germany

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ECONOMIC REPORT, SECOND QUARTER 2024

by 1.28 per cent. The declines were attributed to lower earnings,

rising borrowing costs, and weakened investor confidence.

The performance of equities in EMDEs also varied. South Africa

JALSH and India BSE Sensex 30 grew by 6.03 and 7.31 per cent,
respectively, driven by continued positive investor sentiment.

The Russia IMOEX and Mexico MEXBOL, however, witnessed

negative returns of 5.46 and 8.57 per cent, respectively. Chinese SZI
and Brazil BOVESPA also recorded negative returns of 5.87 and
3.28 per cent, respectively. These declines were attributed to waning
expectation of a rate cut in major AEs, cautious investor confidence,
exchange rates fluctuations and drop in metal prices.

Figure 5: Key Global Stock

20.03
19.00 16.24 Q1 2024 Q2 2024
14.49
14.00 12.43
10.16 10.39
8.49 8.78
7.82 7.53
9.00 6.03
7.31
5.62
3.92
2.84
2.66
4.00 1.43
2.14 1.95

-1.00
-0.03
-1.73 -1.46 -1.28 -1.91
-3.28 -3.07
-6.00 -4.59 -4.53
-5.87 -5.46
UK-FTSE-100

Japan-Nikkei

China-SZI
Brazil-Bovespa
Germany-DAX
US-S&P 500

US-Nasdaq-100

Japan-Topix

South Africa-JALSH
US-Dow Jones

Fance-CAC-40

Euro Area-Euro stoxx 50

India-BSE Sansex
Italy-FTSE MIB

Russia-Moscow Exchange
Mexico-MEXBOL

Source: Reuters Refinitiv Eikon & Trading Economics

The global bond market maintained an upward trajectory

following the delayed rate cuts by key central banks and
moderation in inflation. In AEs, the waning expectations of a policy
rate cut resulted to higher 10-year bond yields. The 10-year bond
yields rose in the US (to 4.34% from 4.19%), UK (to 4.18% from
3.94%) and Euro (to 2.49% from 2.29%). An upward trajectory was
also observed in Canada (to 3.51% from 3.47%), Italy (to 4.07% from
3.68%), and Japan (to 1.05% from 0.71%).

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ECONOMIC REPORT, SECOND QUARTER 2024

In EMDEs, bond yields in Turkey and Indonesia increased to 26.52

and 7.05 per cent, respectively, due to high inflation in Turkey and
election uncertainties in Indonesia. Similarly, bond yields rose in
Russia and Mexico to 15.11 and 9.83 per cent, respectively, because
of growing inflation pressures. Bond yields in India and South Africa,
however, decreased to 7.01 and 9.99 per cent, respectively.

Figure 6: 10-year Government Bond Yields for Selected

Countries
30.00

26.52
25.13
Q4 2023 Q1 2024 Q2 2024

23.69
25.00

20.00

15.11
13.82
12.30
15.00

10.62
9.985
9.77
9.833
9.26
9.02

7.18
10.00

7.05

7.054
7.008

6.69
6.49
4.343
4.19

4.067
3.94
3.86

4.18

3.70
3.68
3.54

3.47
3.507
3.11
2.487
2.29

5.00
2.03

1.046
0.71
0.62

-
USA

UK

Japan

India

South Africa
Mexico

Russia
Euro Area

Canada

Turkey
Italy

Indonesia

Advanced Economies Emerging Market and Developing Economies

Source: Reuters Refinitiv Eikon

1.4 Global Commodity Market

There was an uptick in activities in the global oil market in
Global Crude Oil
Supply and Q22024, driven by increases in both demand and supply from
Demand
the US. Global supply, including Natural Gas Liquids (NGLs),
increased slightly by 0.31 per cent to 102.08 million barrels per day
(mbpd) in Q22024, from 101.76 mbpd in the preceding quarter. This
growth was, largely, driven by higher production in the US, as
additional wells were drilled and completed in the Permian and
Bakken regions. Non-OPEC supply rose marginally by 0.69 per cent
to 70.21 mbpd in Q22024, from 69.73 mbpd in the previous quarter,

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ECONOMIC REPORT, SECOND QUARTER 2024

primarily due to increased output in the US. However, OPEC supply

experienced a slight decline of 0.47 per cent to 31.87 mbpd in
Q22024, from 32.02 mbpd in the previous quarter, following reduced
supplies from Saudi Arabia, Nigeria, Iraq, and Iran.

On the demand side, global demand for crude oil and NGLs rose by
0.94 per cent to 102.80 mbpd in Q22024, from 101.84 mbpd in the
previous quarter. This increase was mainly driven by higher demand
for jet fuel and gasoline, particularly in the US.

Figure 7: Total Global Crude Supply and Demand

105

100
mbpd

95

90
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2021 2021 2021 2021 2022 2022 2022 2022 2023 2023 2023 2023 2024 2024

World Supply World Demand

Source: Energy Information Administration (EIA)

Crude oil spot prices increased in Q22024, primarily driven by

rising fuel consumption in the US. The average spot price of
Crude Oil Nigeria’s reference crude oil, Bonny Light, rose by 1.62 per cent to
Prices
US$86.97 per barrel (pb) in Q22024, from US$85.58 pb in the
previous quarter. Similar upward trends were observed in the prices
of Brent (US$86.11 pb), Forcados (US$88.81 pb), West Texas
Intermediate (US$82.91 pb), and the OPEC Reference Basket
(US$85.46 pb).

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 8: Quarterly Crude Oil Prices (US$ per barrel)

140

120

100

80

60

40

20

0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2021 2021 2021 2021 2022 2022 2022 2022 2023 2023 2023 2023 2024 2024

Bonny Light Brent Forcados WTI Opec Basket

Source: Refinitiv Eikon (Reuters)

The average spot prices of gold, silver, and platinum increased,

Other Mineral
Commodities while palladium recorded a slight decline in Q22024. The
average spot price of gold rose by 12.85 per cent to US$2,337.47
per ounce, from US$2,071.25 per ounce in the previous quarter. The
price of silver increased by 24.38 per cent, to US$29.03 per ounce,
compared with US$23.34 per ounce in the preceding quarter.
Platinum also recorded a 8.10 per cent price rise to US$980.01 per
ounce from US$906.60 per ounce in the preceding quarter. The
increases were driven by escalating tensions in the Middle East,
which heightened safe-haven demand for these precious metals.

The spot price of palladium, however, declined to US$974.70 per

ounce in Q22024, from US$974.99 per ounce. Despite its critical role
in catalytic converters for conventional vehicles, demand for
palladium has been on a decline as the Electric Vehicle (EV) market
continues to expand.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 9: Price Changes in Selected Metals (per cent) for Q2

2024

-10.61
Palladium
-0.03

7.48
Platinum
8.10

24.97
Silver
24.38

18.25
Gold
12.85

-15.00 -10.00 -5.00 0.00 5.00 10.00 15.00 20.00 25.00 30.00

With corresponding quarter With preceding quarter

Source: Refinitiv Eikon (Reuters)

The prices of selected agricultural export commodities

Agricultural
Commodity
increased during the review period, mainly due to supply
Prices constraints caused by weather, pests, and logistics challenges
that affected some of the commodities. The all-commodities price
index rose by 9.10 per cent to 148.89 points (Jan 2010=100) in
Q22024 from 136.47 points in the previous quarter. This increase
was driven by a 49.92 per cent rise in cocoa prices, 24.10 per cent
increase in coffee prices, 7.11 per cent in rubber prices, and 0.90 per
cent in palm oil prices compared with the preceding quarter.
However, the price of cotton declined by 10.83 per cent, groundnut
by 9.42 per cent, soybeans by 6.91 per cent, and wheat by 1.19 per
cent during the review period.

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ECONOMIC REPORT, SECOND QUARTER 2024

Table 2: Indices of Average World Prices of Nigeria’s Major

Agricultural Export Commodities in US$ for Second Quarter
2024, Jan. 2010=100
% Change
COMMODITY 2023Q2 2024Q1 2024Q2
(1) & (3) (2) & (3)
1 2 3 4 5
All Commodities 125.60 136.47 148.89 18.54 9.10
Cocoa 85.30 161.15 241.59 183.22 49.92
Cotton 121.31 125.51 111.92 -7.74 -10.83
Coffee 176.17 222.19 275.73 56.51 24.10
Wheat 180.83 138.71 137.06 -24.21 -1.19
Rubber 44.20 52.01 55.71 26.04 7.11
Groundnut 148.59 167.17 151.42 1.90 -9.42
Palm Oil 110.58 106.10 107.06 -3.18 0.90
Soya Beans 137.79 118.89 110.68 -19.67 -6.91
Source: World Bank

1.5 Monetary Policy Stance

Monetary policy stance remained tight in Q22024, with most
central banks maintaining policy rates at current levels. The US
Fed retained rates between 5.25 to 5.50 per cent due to a
moderation in inflation and expectation that inflation would move
towards the 2.00 per cent target. Similarly, the Bank of England
(BoE) maintained its rate at 5.25 per cent, adopting a more cautious
approach to manage price pressures. In Canada and Japan, policy
rates were kept at 5.00 and 0.10 per cent, respectively. The
European Central Bank (ECB), however, lowered its rate by 25 basis
points to 4.25 per cent.

Most emerging economies also maintained their policy stance due

to anticipated moderation in inflationary pressures. China kept its
rate at 3.45 per cent, aligning with market expectations. India also
maintained its rate at 6.50 per cent, owing to a resilient economy.
Monetary policy rate remained unchanged in South Africa (8.25%),
Russia (16.00%), Mexico (11.00%), and Turkey (50.00%).

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ECONOMIC REPORT, SECOND QUARTER 2024

The Central Bank of Brazil lowered its rates by 25.00 basis points to
10.50 per cent, due to moderation in inflation. In contrast, Indonesia
raised its policy rate by 25.00 basis points to 6.25 per cent to ensure
that inflation remained within the target range.

Table 3: Central Bank Policy Rates (per cent)

Country Q3 2023 Q42023 Q12024 Q22024
United States 5.25-5.50 5.25-5.50 5.25-5.50 5.25-5.50
Canada 5.00 5.00 5.00 5.00
Euro Area 4.50 4.50 4.50 4.25
United Kingdom 5.25 5.25 5.25 5.25
Japan -0.10 -0.10 0.00-0.10 0.10
Brazil 12.75 11.25 10.75 10.50
Russia 13.00 16.00 16.00 16.00
India 6.50 6.50 6.50 6.50
China 3.45 3.45 3.45 3.45
South Africa 8.25 8.25 8.25 8.25
Mexico 11.25 11.25 11.00 11.00
Indonesia 6.00 6.00 6.00 6.25
Turkey 30.00 42.50 50.00 50.00
Source: Various Central Banks’ websites, Trading Economics

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ECONOMIC REPORT, SECOND QUARTER 2024

2.0 DOMESTIC ECONOMIC DEVELOPMENTS

2.1 Real Sector Developments
Domestic economic activity increased in Q22024 on the back of
the sustained investment in infrastructure, and ongoing fiscal
reforms. Although inflation pressure persisted, the government
continued to coordinate broad based policy initiatives to
moderate the trend.

The real GDP grew by 3.19 per cent year-on-year (y-o-y) in Q22024,
Domestic
Output compared with 2.98 per cent recorded in Q12024, driven by
increased activity in both oil and non-oil sectors.

The non-oil sector grew by 2.80 per cent (y-o-y), same as in the
preceding quarter, contributing 2.65 percentage points to GDP
growth. The performance was driven by increased activities in the
financial and insurance, information and communication, crop
production, trade, manufacturing, and real estate sub-sectors.

Growth in the oil sector nearly doubled to 10.15 per cent (y-o-y) in
Q22024, compared with 5.70 per cent in the preceding quarter, and
contributed 0.54 percentage point to the overall growth. This
performance was driven by increased prices of Nigeria’s Bonny light
crude in the international market which rose from $79.89/pb in
Q22023 to $86.97/pb in Q22024. However, on a quarter-on-quarter
basis, the oil sector contracted, owing to pockets of oil theft,
vandalism and other security challenges.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 10: Real GDP Growth Rate, Q22021- Q22024, Year-on-

Year
15 12.11
10.15

10 6.74 6.08
5.44 4.73 4.77
5.70
4.27 4.44
3.58
5 2.77 2.75 3.07 2.80 2.80

0
Percent (%)

(0.85)
-5 (4.21)

-10 (8.06)

(10.73)
(11.77)
-15 (12.65)
(13.38) (13.43)

-20
-25 -22.67

(26.04)
-30
Q22021 Q32021 Q42021 Q12022 Q22022 Q32022 Q42022 Q12023 Q22023 Q32023 Q42023 Q12024 Q22024

Oil GDP Non-oil GDP Total GDP

Source: National Bureau of Statistics (NBS)

2.1.1 Sectoral Performance

The services sector continued to drive growth, contributing 2.21
percentage points to overall growth in the review period. The sector
grew by 3.79 per cent (y-o-y) in Q22024, compared with 4.32 per
cent in Q12024, and accounting for 58.76 per cent of GDP. The
development was attributed mainly to the significant performance of
the financial and insurance subsector.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 11: Sectoral Growth Rate of Real GDP, Q22021- Q22024

12.00
9.27
10.00 8.41
7.45
8.00 6.70 7.01
5.58 5.69
6.00 4.35 4.42 4.32
3.99 3.98 3.79
3.58 3.86 3.53
4.00 3.16
2.05 2.10 2.19
1.50 1.41
Per cent
1.30 1.22 1.20 1.34 1.30
2.00 0.31 0.46 0.18
0.00
-0.05
-2.00 -1.23 -0.94 -0.90
-1.63 -1.94
-2.30
-4.00
-6.00
-8.00 -6.81
-8.00
-10.00
Q22021 Q32021 Q42021 Q12022 Q22022 Q32022 Q42022 Q12023 Q22023 Q32023 Q42023 Q12024 Q22024

Agriculture Industry Services Total GDP

Source: National Bureau of Statistics

The financial and insurance subsector grew by 28.79 per cent

(contributing 1.52% points to GDP growth) on account of foreign
exchange windfall gains in the banking and insurance sectors. The
information and communications subsector grew by 4.44 per cent
(contributing 0.87% points to GDP growth), following sustained digital
transformation within the financial sector, including the continued
expansion of fintech firms, mobile banking adoption, and
digitalisation drive. Growth in the ICT subsector was also spurred by
increased demand for digital services, such as data/internet services
and e-commerce, which contributed to boosting economic activities
in the other subsectors. The trade and real estate subsectors grew
by 0.70 and 0.75 per cent, respectively, contributing 0.12 and 0.04
percentage points to overall growth in Q22024.

The agriculture sector grew by 1.41 per cent, compared with 0.18 per
cent in the preceding quarter. The growth was driven by continued
support from the government (particularly investment in the purchase
of farm inputs and machinery), the bumper harvest of some staples
and increased demand for wood boosted growth in the forestry
subsector. Crop production subsection grew by 1.65 per cent,

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ECONOMIC REPORT, SECOND QUARTER 2024

compared with 1.71 per cent in Q12024, while the forestry and fishing
subsectors grew by 2.77 and 0.38 per cent, respectively, compared
with a growth of 2.73 per cent and a contraction of 1.44 per cent in
Q12024. The livestock subsector remained in recession but showed
an improvement with a contraction of 1.71 per cent, compared with a
contraction of 23.29 per cent in the preceding quarter. The
development was due largely to unavailability of feedstock due to the
rainy season.

The industrial sector maintained its growth trajectory, growing by

3.53 per cent in Q22024, compared with 2.19 per cent in Q12024.
Increased activities in manufacturing, water supply, sewerage &
waste management, electricity, and construction contributed to the
growth outcome. Consequently, growth was witnessed in all
subsectors: mining & quarrying (7.79%), manufacturing (1.28%),
water supply, sewerage, waste management (8.20%), electricity,
gas, steam & air conditioning (5.96%), and construction (1.05%) in
Q22024. The growth outcomes were reflected in the Index of
Industrial Production (IIP), which grew by 4.13 per cent (y-o-y) in
Q22024, compared with 3.34 per cent in the preceding quarter.

Table 4: Index of Industrial Production (Q42022 – Q22024)

Period IIP Y-on-Y Change Q-on-Q Change
Q4 2022 88.40 -1.78 -5.35
Q1 2023 101.80 -0.49 15.16
Q2 2023 91.90 -3.16 -9.72
Q3 2023 93.10 -0.32 1.31
Q4 2023 91.70 3.73 -1.50
Q1 2024 105.20 3.34 14.72
Q2 2024 95.70 4.13 -9.03
Source: Central Bank of Nigeria
Note: IIP refers to index of industrial production.

The manufacturing subsector grew by 1.28 per cent in Q22024,

contributing 0.11 percentage points to GDP growth. This underlined
by the improvement in the index of manufacturing production which

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ECONOMIC REPORT, SECOND QUARTER 2024

also grew by 1.27 per cent (y-o-y), compared with the 1.51 per cent
growth recorded in the preceding quarter. Subsequently, the
estimated average manufacturing capacity utilisation increased by
0.40 percentage points to 60.00 per cent in Q22024, from 59.60 per
cent in Q22023. The performance of the manufacturing subsector
was attributed to the shifting preference of consumers towards
domestically produced goods, mainly in the food, beverage, and
tobacco, due to the elevated cost of imported goods.

Table 5: Index of Mining Production (Q42022 – Q22024)

Period IMANP Y-on-Y Change Q-on-Q Change

Q4 2022 190.10 2.87 4.11

Q1 2023 205.30 1.58 8.00

Q2 2023 173.50 2.18 -15.49

Q3 2023 183.50 0.49 5.76

Q4 2023 192.70 1.37 5.01

Q1 2024 208.40 1.51 8.15

Q2 2024 175.70 1.27 -15.69

Source: Central Bank of Nigeria

Note: IMANP refers to index of manufacturing production.

The mining and quarrying subsector grew by 7.79 per cent,

contributing 0.43 percentage points to GDP growth in Q22024. This
growth followed sustained efforts to improve crude oil production and
increased demand for metal ore. The index of mining production also
displayed a similar trend, growing by 7.66 per cent (y-o-y) in Q22024,
as against 6.14 per cent in Q12024.

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ECONOMIC REPORT, SECOND QUARTER 2024

Table 6: Index of Manufacturing Production (Q42022 – Q22024)

PERIOD IMINP Y-ON-Y CHANGE Q-ON-Q CHANGE

Q1 2023 57.00 -3.88 38.35

Q2 2023 49.60 -12.06 -12.98

Q3 2023 52.10 -1.88 5.04

Q4 2023 44.50 8.01 -14.59

Q1 2024 60.50 6.14 35.96

Q2 2024 53.40 7.66 -11.74

Source: Central Bank of Nigeria

Note: IMINP refers to the index of mining production.

Out of the 22 subsectors in the economy, 19 subsectors grew, while

three subsectors – other services, livestock, and transportation &
storage – contracted in Q22024.

Figure 12: Top 16 Subsectors with largest Contribution to GDP

Growth and their Growth Rates (per cent) in Q22024

(28.79%) Financial and Insurance 1.52

(4.44%) Information and… 0.87

(7.79%) Mining and Quarrying 0.43

(1.65%) Crop Production 0.34

(0.70%) Trade 0.12

(1.28%) Manufacturing 0.11

(5.96%) Electricity,Gas,Steam & Air… 0.04

(1.34%) Professional, Scientific &… 0.04

(1.85%) Public Administration 0.04

(0.75%) Real Estate 0.04

(8.20%) Water supply, sewage, waste… 0.03

(1.05%) Construction 0.03

(1.92%) Education 0.03

(2.41%) Human Health & Social Services 0.02

Source: National Bureau of Statistics

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Figure 13: Subsectors with Least Contribution to GDP Growth

and their Growth Rates (per cent) in Q22024

-0.34 Other Services (-12.66%)

-0.12 Transportation and Storage (-13.53%)

-0.03 Livestock (-1.71%)

Source: National Bureau of Statistics

2.1.2 Inflation
General prices rose in the review quarter, owing mostly to the
Headline lingering effects of high energy costs, increased import costs,
Inflation
and expectations of further price rises amid other structural
factors. Headline inflation (y-o-y) ticked up to 34.19 per cent in
Q22024 from 33.20 per cent in the preceding quarter.

Figure 14: Headline, Food and Core Inflation (year-on-year)

45.0

40.0
COVID-19
35.0

30.0
Percent (%)

PMS
25.0 subsidy
removal,
Ukraine
Russia-

20.0 Rate
War

unification

15.0

10.0

5.0

0.0
Q22021 Q32021 Q42021 Q12022 Q22022 Q32022 Q42022 Q12023 Q22023 Q32023 Q42023 Q12024 Q22024

Headline Core Food

Source: Staff compilation based on National Bureau of Statistics data

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ECONOMIC REPORT, SECOND QUARTER 2024

Inflation remained largely broad-based across the components of the

Inflation
Pervasiveness CPI basket during the review period. Staff estimate indicated that
inflation was as pervasive in Q22024 as in the preceding quarter
(end-March), with 70.15 per cent of items within the CPI basket
remaining above the historical average of 14.18 per cent (2010-
2023)1.

Figure 15: Inflation Pervasiveness2

Annual Monthly
100

80

60
Per cent

40

20

0
2016

2019
2015

2017
2018

2020
2021
2022

Jan-24
Jan-23

Mar-23

Sep-23

Mar-24
Nov-23
Dec-23
Jun-23

Jun-24
Feb-23

Apr-23

Aug-23

Feb-24

Apr-24
Jul-23

Oct-23
May-23

May-24
< 5.99% 6-10.99% 11-14.17% > 14.18%

Source: Staff compilation based on National Bureau of Statistics data

Although headline inflation trended upward in Q22024, the pace of

price increases declined for the fourth consecutive month, settling at
0.24 per cent. At this rate of decline, inflation (annualised) is expected
to moderate by December 2024.

1 The historical average was adjusted in May 2024 to 14.18 per cent (2010-2023), from 13.27 per cent (1996-2023) in the
preceding months to reflect recent reality, given the base period. This explains why inflation was less pervasive, compared
with the preceding month.

2
Pervasiveness is measured by the number of headline CPI items that are within specific inflation range. It reflects the extent
to which rising prices are affecting the cost of living. Historically, inflation in Nigeria has been high, with average inflation of
14.18 per cent from 2010–2023. Inflation is said to be more pervasive if there is a higher number of items registering inflation
above the historical average. The CPI items are therefore categorised into four groups namely, percentage of items registering
inflation of less than 5.99 per cent, between 6 per cent and 10.99 per cent, between 11 per cent and 14.17 per cent and, also
inflation above 14.18 per cent.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 16: Inflation Momentum

2.00 37.00
1.80
1.80
36.00
1.60 1.50

Inflation Momentum (%)

35.00
1.40

1.20
34.00

Annualised (%)
0.98
1.00 33.00

0.80
32.00
0.60 0.49
31.00
0.40 0.26 0.24
0.20
30.00

0.00 29.00
Jan'24 Feb'24 Mar'24 Apr'24 May'24 Jun'24

Inflation momentum Annualised

Source: Staff compilation based on National Bureau of Statistics data

Note: Inflation Momentum is measured by taking the CPI for December end period of every year as the base period to
calculate the year-to-date inflation. The annualised or inflation momentum is then gotten by dividing the year-to-date inflation
of the current period by the figure that stands for each of the 12 months (e.g: 1=January, 3=March, 9=September, or
11=November etc).

Core inflation rose further to 27.40 per cent in Q22024, compared

Core with 25.90 per cent in Q12024. Persistent by high manufacturing
Inflation
input costs, elevated prices of imported goods, and expectations of
further rise in inflation contributed to the increase. Importantly, higher
energy costs, particularly the 202.94 per cent hike in electricity price
(from an average of N68/kWh in Q12024 to an average of ₦206/kWh
in Q22024), was a key accelerant of core inflation.

Component analysis revealed that the uptick in core inflation was

also derived from the following items: fish & seafood (3.91 pp), actual
& input rentals for housing (3.77 pp), meat (3.42 pp), oil & fats (2.79
pp), and clothing & footwear (2.05 pp).

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Figure 17: Measures of Underlying Inflation

30.00

25.00

20.00

15.00

10.00

5.00
Q12021 Q22021 Q32021 Q42021 Q12022 Q22022 Q32022 Q42022 Q12023 Q22023 Q32023 Q42023 Q12024 Q22024

Core inflation Trimmed Median 20% Trimmed Mean

Source: Staff compilation based on National Bureau of Statistics data

Although underlying inflation remained elevated across all measures,

Trimmed
Mean and the trend of the trimmed mean and median measures rose slower
Median
Measures than the core inflation measure in the review period.3 The core
measure of underlying inflation was 8.79 percentage points higher
than the trimmed median measure and 8.67 percentage points above
the trimmed mean.

3 Core inflation: measure of underlying inflation defined as headline less farm produce and energy
prices.
Trimmed Mean: measure of underlying inflation derived using the average rate of inflation after
trimming away a certain percentage of the distribution of price changes outliers at both ends of that
distribution.
Trimmed Median: measure of underlying inflation derived by obtaining median values from inflation
of CPI components.

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Figure 18: Component Drivers of Core Inflation

Meat Fish & Sea Food
Milk,Cheese & Eggs Oil & Fats
Sugar,Jam,Honey,etc BREAD UNSLICED 500g
CABIN BISCUIT: LOCAL MANUFACTURE 800g PACK EKO(AGIDI/KAFA)
GARI WHITE,SOLD LOOSE GARI YELLOW,SOLD LOOSE
MAIZE PASTE-WHITE(OGI/AKAMU) PLANTAIN FLOUR
YAM FLOUR,SOLD LOOSE Non-Alcoholic Beverages
Alcoholic Bev. Tobacco & Kola Clothing & footwear
Actual and imputed rentals for housing Furnishings, Household Equip &HH Maint.
Health Vehicle Spare Parts
Passenger transport by road Education
Restaurant & Hotels Miscellaneous Goods & Services
OTHERS Core Inflation
30.00

25.00

20.00

15.00

10.00

5.00

0.00

Source: Staff compilation based on National Bureau of Statistics data

Analysis indicated that more items in the core CPI basket had
become volatile, hence excluded from the trimmed measures. At the
upper band of the trimmed inflation measure, available data showed
that the following items were volatile with significant increases, and
hence excluded from the computation: bread & cereals (47.08 pp);
yam & other tubers (45.19pp); actual & imputed rentals for housing
(41.27pp); oils & fats (38.76pp); passenger transport by road
(36.41pp); fish and coffee (36.28pp); and tea & cocoa (36.23pp).
Also, at the lower band, the following were excluded: telephone and
telefax services (1.42pp), telephone & telefax equipment (2.20pp),
passenger transport by sea & inland waterway (3.24pp), musical
instrument (4.40pp), motorcycles (5.27pp), water supply (5.66pp)
and motor cars (5.71pp).

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Food inflation (y-o-y) rose to 40.87 per cent from 40.01 per cent in
Food
Inflation
the preceding quarter, due to rising cost of energy and farm input,
resulting in increased transport and logistics costs. This reflected the
higher prices of premium motor spirit (PMS) and diesel at N750.17
and N1,462.98 per litre in Q22024, compared with N696.79 and
N1,341.16 per litre, respectively, in Q12024. Also, increased
demand occasioned by Eid festivities further contributed to the rise
in food inflation.

Figure 19: Contribution of Processed Food and Farm Produce

to Food Inflation
45.00
40.00
35.00
30.00
25.00
PER CENT

20.00
15.00
10.00
5.00
0.00

Processed food Farm produce Food Inflation

Source: National Bureau of Statistics

The processed food component recorded a dis-inflation during the

quarter, owing largely to a decline in the contribution of garri to food
inflation to 6.84pp in Q22024 from 8.30pp in Q12024. This
development stemmed from the early harvest of cassava.
Contribution of farm produce to food inflation, however, rose following
surge in the cost of rice, maize, millet and sorghum, and yam & other
tubers.

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Figure 20: Component Drivers of Food Inflation

Meat, Fish & Egg Oil & Fats

Sugar,Jam,Honey,etc Bread, Biscuit & Sausage

Processed Corn Garri

Flours Fruits & Vegatables

Yam, Potatoes & other tubers Maize Grain White Sold Loose

Millet (Jero or Maiwa) Sold Loose Rice (Local & Imported)

Sorghum (Guinea Corn) White or Brown,Sold Loose Food Inflation

45.00

40.00

35.00

30.00

25.00

20.00

15.00

10.00

5.00

0.00

Source: Staff compilation based on National Bureau of Statistics data

The key contributors to food inflation in Q22024 were garri (6.84 pp),
meat, fish & eggs (6.74 pp), yam, potatoes & other tubers (5.42 pp),
rice (4.76 pp), fruits & vegetables (3.09 pp), and oil & fats (2.38 pp).

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ECONOMIC REPORT, SECOND QUARTER 2024

Box Information 1☹)

The prices for all the monitored domestic agricultural commodities increased in Q22024
compared with the previous quarter, and the corresponding quarter of 2023. The price
increases ranged from 10.41 per cent for palm oil, to 69.18 per cent for beans (brown). This
development was primarily driven by the persistent increase in the costs of farm inputs and
transportation, exacerbated by higher energy prices.

Prices of Selected Domestic Agricultural Commodities in Q22024

DOMESTIC PRICES OF SELECTED AGRICULTURAL COMMODITY PRICES, SECOND QUARTER 2024

% %
Q22023 Q12024 Q22024
Change Change
UNIT 1/a 2/a 3/b (1) & (3) (2) & (3)
Agric eggs medium size 1kg 945.20 1472.51 1776.86 87.99 20.67
Beans: brown, sold loose " 632.18 1129.64 1911.11 202.30 69.18
Beans: white black eye, sold loose " 602.32 1090.14 1761.20 192.40 61.56
Gari white, sold loose " 379.02 691.34 1080.95 185.19 56.36
Gari yellow, sold loose " 410.16 727.26 1148.94 180.12 57.98
Groundnut oil: 1 bottle, specify bottle " 1345.17 2018.42 2340.67 74.01 15.97
Irish potato " 592.04 1145.62 1590.37 168.62 38.82
Maize grain white, sold loose " 358.73 707.07 926.50 158.27 31.03
Maize grain yellow, sold loose " 365.75 707.89 933.02 155.10 31.80
Onion bulb " 462.09 911.89 1154.21 149.78 26.57
Palm oil: 1 bottle, specify bottle " 1130.17 1528.03 1687.05 49.27 10.41
Rice agric, sold loose " 649.67 1246.79 1610.08 147.83 29.14
Rice local, sold loose " 570.05 1195.17 1577.23 176.68 31.97
Rice, medium grained " 630.80 1310.81 1688.32 167.65 28.80
Rice, imported high quality, sold loose " 804.78 1501.81 1969.01 144.66 31.11
Sweet potato " 300.71 659.26 1033.56 243.70 56.78
Tomato " 510.24 914.26 1439.30 182.08 57.43
Vegetable oil: 1 bottle, specify bottle " 1274.94 1888.41 2214.57 73.70 17.27
Wheat flour: prepackaged (Golden Penny) 2kg 1330.31 2266.07 2931.81 120.39 29.38
Yam tuber 1kg 470.90 993.42 1295.01 175.01 30.36
Sources: (a) National Bureau of Statistics (b) Staff Estimates

29 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

2.1.3 Socio-Economic Developments

In a bid to further deepen the economy's long-term growth prospects,
the federal government sustained efforts to improve the quality of air

Transportation and road transport infrastructure in the country. These included the
approvals for upgrading Ladoke Akintola Airport, formerly called
Ibadan Airport, Alakia, Ibadan, to an international facility and the
construction of ancillary roads in Enugu, Rivers, and Lagos states.

To revitalise the Nigerian health sector and aid increased local

Health
production of healthcare products, the government signed an
executive order to introduce zero tariffs, excise duties, and VAT on
imported pharmaceutical inputs.

The federal government, through the Industrial Training Fund,

commenced training programs for five million youths nationwide
Empowerment
under the Skill Up Artisan Program (SUPA). The program is being
implemented in stages with 100,000 artisans per batch. Likewise, the
government revised the Nigeria Youth Investment Fund, with a
N110.00 billion commitment to support startups and early-growth
businesses led by youths, through access to loans and
comprehensive business support.

2.1.4 Energy Sector and Electricity

2.1.4.1 Domestic Crude Oil Market Development
Crude Oil Domestic crude oil production declined in Q22024, attributed to
Production persistent oil theft and illegal refining activities in the Niger-
and Export
Delta region. Nigeria’s average crude oil production fell by 4.51 per
cent to 1.27 mbpd in Q22024, from 1.33 mbpd in the preceding
quarter. This was due to crude oil theft and pipeline vandalism in the
Niger Delta region, leading to a decline in production from the

30 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Forcados, Bonny, Qua-Iboe, Escravos and Brass streams,

respectively. Nigeria’s crude oil production level fell short of its OPEC
quota of 1.58 mbpd by 308,000 bpd in Q22024.

Figure 21: Nigeria’s Crude oil production and OPEC quota

(mbpd)

2.0
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2021 2021 2021 2021 2022 2022 2022 2022 2023 2023 2023 2023 2024 2024

Crude Oil Production OPEC Quota

Source: Nigerian Upstream Petroleum Regulatory Commission (NUPRC)

The performance of the electricity sector improved due to

Electricity increased water supply to hydro substations, rise in gas supply
Generation /
Consumption to thermal stations, and enhancements in electricity
transmission and distribution infrastructure. Thus, the average
estimated electricity generation in Q22024 at 4095.24 MW/h,
increased by 6.19 per cent relative to 3,856.50 MW/h in Q12024.
Also, the average estimated electricity consumption, at 3,918.15
MW/h increased by 4.47 per cent in Q22024 compared with 3,750.40
MW/h, in the preceding quarter. Similarly, the index of electricity
production increased by 194.47 per cent on a q-o-q basis against a
contraction of 46.04 per cent in Q12024. However, on a y-o-y basis,
the index recorded a slower growth of 6.79 per cent, relative to 11.02
per cent in the corresponding period.

31 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Table 7: Index of Electricity Production

PERIOD IEP Y-ON-Y CHANGE Q-ON-Q CHANGE

Q42022 245.60 13.60 29.95

Q12023 139.40 7.40 -43.24

Q22023 389.00 11.02 179.05

Q32023 198.90 5.24 -48.87

Q42023 261.50 6.47 31.47

Q12024 141.10 1.22 -46.04

Q22024 415.40 6.79 194.47

Source: Central Bank of Nigeria

Note: IEP refers to index of electricity production.

32 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

2.2 Fiscal Sector Developments

Provisional data indicated that fiscal operations improved in
Q22024, on account of higher receipts from oil and non-oil
sources. Federally collected revenue rose by 26.37 per cent,
relative to the level in the preceding quarter, but fell short of the
benchmark by 30.17 per cent. Retained revenue of the Federal
Government of Nigeria (FGN) was 57.66 per cent above the level
Summary
in Q12024 but was 52.94 per cent below the target. FGN
expenditure was 27.79 per cent above the level in the preceding
quarter but 4.94 per cent below the target. Fiscal deficit
expanded by 16.56 and 97.56 per cent relative to the levels in
Q12024 and the target, respectively, following a 95.95 per cent
rise in interest payment. At ₦121.67 trillion (51.22% of GDP)
public debt was above the 40.00 per cent benchmark as at end-
March 2024.

2.2.1 Federation Account Operations

Gross federation account earnings improved in Q22024, on
Drivers of account of higher receipts from oil and non-oil sources. At
Federation
Revenue N6.28 trillion, provisional gross federation account receipt was 26.37
per cent above the level in Q12024, but 30.17 per cent below the
benchmark. The improved performance reflected higher realisations
from royalties, petroleum profit tax (PPT), independent revenue of
FGN and upstream CIT.4 With regards to the composition of gross
federation revenue, non-oil revenue remained dominant, accounting
for 72.42 per cent, while oil revenue constituted the balance.

Higher receipts from royalties, PPT, and upstream CIT resulted in a

13.23 per cent increase in oil revenue to N1.73 trillion, relative to

4Based on Nigeria’s Petroleum Industry Act (PIA 2021), Companies Income Tax (CIT) now applies to
upstream crude oil production operations.

33 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Q12024. The performance, however, was below the target by 67.30

per cent.

Non-oil revenue, at N4.55 trillion, was 32.22 and 23.07 per cent
above the levels in the preceding quarter and the target, respectively.
The increase was driven, largely, by higher collections from
independent revenue of the FGN, VAT and customs & excise duties.

Figure 22: Gross Revenue Outturn and Benchmark (₦ Billion)

10000
9000
8000
7000
6000
5000
4000
3000
2000
1000
0
Q22023 Q32023 Q42023 Q12024 Q22024 Budget

Non-oil Revenue Oil Revenue Federally Collected Revenue

Source: Office of the Accountant-General of the Federation (OAGF) and Federal Ministry of Finance
(FMF)

34 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Table 8: Federally Collected Revenue and Distribution to the

Three-Tiers of Government (₦ Billion)
Q22023 Q12024 1/ Q22024 1/ Budget*

Federally Collected Revenue 3,237.66 4,973.41 6,285.04 9,000.02

Oil 809.02 1,530.91 1,733.50 5,301.56

Crude Oil & Gas Exports 0.00 182.65 9.49 366.09

PPT 438.42 366.93 445.34 2,655.89
Royalties 340.99 592.68 800.86 1,605.90
Domestic Crude Oil/Gas Sales 0.00 0.00 0.00 26.25
Others 29.61 388.65 477.81 647.41
Non-oil 2,428.63 3,442.50 4,551.54 3,698.46

Corporate Tax 630.40 1,022.86 895.24 814.19

Customs & Excise Duties 381.82 667.35 845.87 717.22
Value-Added Tax (VAT) 706.73 1,373.73 1,548.28 988.53
Non-Regular Earnings/EMTL 45.18 50.97 49.92 43.78
Independent Revenue of Fed. Govt. 655.70 318.79 1,203.42 673.19
Others** 8.80 8.80 8.80 461.55

Total Deductions/Transfers
1,215.63 2,766.58 4,090.13 2,115.51
Federally Collected Revenue
Less Deductions & Transfers*** 2,022.03 2,206.83 2,194.90 6,884.51
plus:
Additional Revenue 164.69 1,223.15 1,279.78 43.56
Excess Crude Revenue 0.00 0.00 0.00 0.00
Non-oil Excess Revenue 94.05 48.93 47.92 43.56
Exchange Gain 70.64 1,174.22 1,231.86 0.00

Total Distributed Balance

2,186.72 3,429.98 3,474.68 6,928.07
Federal Government 837.50 1,143.55 1,102.11 3,288.04
Statutory 738.94 951.67 885.85 3,150.68
VAT 98.56 191.88 216.26 137.37
State Government 728.79 1,143.05 1,190.51 1,424.54
Statutory 400.26 503.44 469.63 966.65
VAT 328.53 639.61 720.88 457.89
13% Derivation 84.01 309.26 317.08 650.23
Local Government 536.42 834.12 864.98 1,565.25
Statutory 306.45 386.40 360.36 1,244.73
VAT 229.97 447.73 504.62 320.52
Source: Office of the Accountant-General of the Federation and CBN Staff Estimates.
Note: *Budget is based on 2024 appropriation Act, ** Includes Education Tax, Customs Special Levies
(Federation Account), National Information Technology Development Fund, Customs Special Levies, Solid
Minerals & Other Mining revenue, and other non-regular earnings; *** Deductions include cost of revenue
collections and JVC cash calls; while transfers entail provisions for FGN Independent revenue and other non -
federation revenue. /1 Figures are Provisional

35 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Of the total statutorily collected revenue, a net balance of N3.47

trillion was distributed to the three tiers of government, after
accounting for additional revenue and statutory deductions/transfers.
The federal, state and local governments received N1.10 trillion,
N1.19 trillion and N0.86 trillion, respectively, while the balance of
N0.32 trillion was allocated to the 13% Derivation Fund for oil-
producing states. Net disbursement was 1.30 per cent above the
level in Q12024, but 49.85 per cent short of the quarterly budget
target.

2.2.2 Fiscal Operations of the Federal Government

Federal FGN retained revenue improved in the review period, on
Government account of higher receipts from its independent revenue
Retained
Revenue sources. At N2.30 trillion, provisional data indicated that FGN
retained revenue was 57.66 per cent above the level in Q12024 but
was 52.94 per cent below the quarterly target.

Table 9: FGN Retained Revenue (₦ Billion)

Q22023 Q12024* Q22024* Budget
FGN Retained
1,480.38 1,462.34 2,305.54 4,899.62
Revenue
Federation Account 647.98 397.84 307.12 3,144.14
VAT Pool Account 98.56 191.88 216.26 137.37
FGN Independent
655.70 318.79 1,203.42 673.19
Revenue
Excess Oil Revenue 0.00 0.00 0.00 0.00
Excess non-oil 17.03 7.34 7.19 6.53
Exchange Gain 33.76 546.49 571.54 0.00
Others** 33.92 0.00 0.00 938.38
Source: Office of the Accountant General of the Federation
Note: * Provisional
** Others include revenue from Special Accounts and Special Levies.

36 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Provisional data indicated that aggregate expenditure of the

FGN rose due to higher interest payments. At N6.83 trillion,
Federal expenditure in Q22024 exceeded the level in the preceding quarter
Government
Expenditure by 27.79 per cent but was 4.94 per cent short of the projected
spending of N7.19 trillion. Analysis of total expenditure showed that
recurrent constituted 89.97 per cent, while, capital, and transfer
payments accounted for 3.66 and 6.37 per cent, respectively.

Figure 23: Federal Government Expenditure (₦ Billion)

8000

7000

6000

5000

4000

3000

2000

1000

0
Q22023 Q32023 Q42023 Q12024 Q22024 Budget

Recurrent Expenditure Capital Expenditure

Transfers Total Expenditure

Source: CBN Staff Estimates and OAGF

The fiscal operations of the FGN resulted in a higher fiscal

Overall Fiscal
deficit in Q22024. Provisional data showed that overall deficits
Balance
expanded to N4.53 trillion, from N3.88 trillion in the preceding
quarter, driven by a larger decline in revenue relative to
expenditures. The primary deficit, however, narrowed to N0.09
trillion from N1.61 trillion in Q12024, following a significantly lower
capital outlay.

37 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Table 10: Fiscal Balance (₦ Billion)

Q22023 Q12024* Q22024* Budget
Retained revenue 1,480.38 1,462.34 2,305.54 4,899.62
Aggregate expenditure 4,114.17 5,351.76 6,838.96 7,194.35
Recurrent 3,031.16 4,053.96 6,152.97 4,259.87
Non-debt 1,418.21 1,784.4 1,705.89 2,192.13
Debt Service 1,612.95 2,269.56 4,447.09 2,067.74
Capital 877.75 1,152.57 250.29 2,498.79
Transfers 205.25 145.23 435.70 435.70
Primary balance -1,020.83 -1,619.86 -86.33 - 226.99
Overall balance -2,633.79 -3,889.42 -4,533.42 -2,294.73
Source: Data from OAGF and CBN Staff Estimates
Note: *The figures are provisional

Public debt stock remained above the 40.0 per cent national
Federal threshold at end-March 2024. Total public debt outstanding stood
Government
Debt at N121.67 trillion (51.22% of GDP), at end-March 2024, and was
24.99 per cent, higher than the levels at end-December 2023. The
rise was due, largely, to the exchange rate revaluation of debt stock,
securitisation of ways and means advances, and new borrowings. A
breakdown of the consolidated public debt showed that, domestic
debt accounted for 53.95 per cent, while external debt obligations
constituted 46.05 per cent. Of the consolidated public debt stock,
FGN owed N117.60 trillion (96.66%), while the state governments
accounted for the balance. 5

A disaggregation of the FGN debt obligations showed that domestic

debt was N61.57 trillion (52.36%), while external debt constituted
N56.02 trillion (47.64%). Further analysis revealed that FGN Bonds
maintained its dominance, with 78.63 per cent of the total domestic
debt stock, followed by Treasury Bills (16.95%), Promissory Notes
(2.55%), and FGN Sukuk (1.77%), while others6 constituted the

5 The ₦117.6 trillion pubic debt recorded for FGN includes the external debt of State governments,
which are contingent liabilities of the Federal government.
6
Includes treasury bonds (0.00%), green bond (0.02%) and special FGN savings bond (0.07%).

38 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

balance. Of the total external debt stock, multilateral accounted for

49.45 per cent, while commercial (36.54%) and bilateral loans
(14.01%) constituted the balance.

Debt service obligations in Q12024 fell by 12.98 per cent to N2.47

trillion, from N2.84 trillion in Q42023, owing to fewer maturing
bilateral and commercial obligations, relative to the preceding
quarter. A breakdown showed that domestic debt service was N0.99
trillion (39.90%), while external debt service constituted N1.48 trillion
(60.10%).

Figure 24: FGN External and Domestic Debt Composition

(₦ Billion)

117,602.72
140000

91,477.86
82,172.29
81,563.72

120000
100000
44,374.69

80000
60000
40000
20000
0
Q12023 Q22023 Q32023 Q42023 Q12024
External Debt Domestic Debt Total

Source: Debt Management Office

39 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Figure 25: Domestic Debt Stock by Instrument as at end-March

2024
Promissory Note
FGN Sukuk 2.55% Others
1.77% 0.10%

Treasury Bills
16.95%

FGN Bonds
78.63%

FGN Bonds Treasury Bills Promissory Note FGN Sukuk Others

Source: Debt Management Office

Figure 26: External Debt Stock by Instrument as at end-March

2024

14.01%

49.45%

36.54%

Multilateral Commercial Bilateral

Source: Compiled from DMO figures

40 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

2.3 Monetary and Financial Developments

Monetary aggregates trended upwards due to currency
Summary depreciation and increased credit to key sectors of the
economy. Broad money supply expanded, following growths in
both the net foreign assets (NFA) and net domestic assets
(NDA). Key short-term interest rates rose in line with the Bank’s
restrictive monetary policy stance. Activities in the Nigerian
equities market slowed, in response to rising interest rate. The
bearish performance reflected the shift of investors’ preference
from equities to fixed income securities due to attractive yields.

2.3.1 Monetary Developments

Reserve money increased in Q22024, reflecting the rise in
Reserve Money
currency-in-circulation (CIC). Relative to the level at end-
December 2023, reserve money grew by 1.16 per cent to ₦25.02
trillion, but was 11.50 per cent and 5.46 per cent below the 2024
provisional benchmark of ₦28.27 trillion and the level in Q12024,
respectively. The growth in reserve money underlain by the 10.82
per cent increase in CIC to ₦4.05 trillion. Liabilities to other
depository corporations (LODCs) declined by 0.51 per cent.

41 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Figure 27: Developments in Reserve Money (₦ Trillion) and

Money Multiplier
30 5

24.74 4
25 23.38 25.02
4
20 19.51 3
17.34
₦ Trillion

Ratio
15 21.08 20.97
19.52 2
16.75
10 14.74 2
1
5
1
2.6 2.76 3.65 3.87 4.05
- -
Q2'23 Q3'23 Q4'23 Q1'24 Q2'24
Currency-in-Circulation Liabilities to ODCs
Reserve Money M3 Multiplier (RHS)

Source: Central Bank of Nigeria

Figure 28: Q-o-Q Growth in Reserve Money

70
60
50 61.91

40
Per cent

30 28.6
20
13.17
10
- -0.51
(10) -7.43

(20)
Q2'23 Q3'23 Q4'23 Q1'24 Q2'24
Currency-in-Circulation Reserve Money Liabilities to ODCs

Source: Central Bank of Nigeria

Notes and coins, which constituted the largest component of CIC,

rose to ₦4.03 trillion at end-June 2024, from ₦3.86 trillion at end-
March 2024. The eNaira also grew to ₦0.02 trillion at end-June 2024,
from ₦0.01 trillion at end-March 2024.

42 | P a g e Central Bank of Nigeria Economic Report Q22024

 ECONOMIC REPORT, SECOND QUARTER 2024

Figure 29: Composition of Currency-in-Circulation

4.50
4.00
3.50
3.00
₦ Trillion 2.50
2.00
1.50
1.00
0.50
0.00
Q2'23 Q3'23 Q4'23 Q1'24 Q2'24
eNaira 0.01 0.01 0.01 0.01 0.02
Notes and Coins 2.59 2.75 3.64 3.86 4.03
Currency-in-Circulation 2.60 2.76 3.65 3.87 4.05

eNaira Notes and Coins Currency-in-Circulation

Source: Central Bank of Nigeria

The broad money supply (M3) grew by 27.88 per cent to ₦101.35
trillion in Q22024, as the money multiplier rose to 4.05, from 3.94 in
Q12024. Analysis of the liability side showed that the rise in broad

Broad Money Supply money liabilities was due to the combined growth in other deposits
(32.54%), transferable deposits (23.61%), and currency outside
depository corporations (10.38%). Other deposits contributed the
most to the growth in M3 with 20.00 percentage points (pp), followed
by transferable deposits (7.95 pp) and currency outside depository
corporations (0.45 pp). The rise in other deposits was influenced,
mainly, by naira revaluation of foreign currency deposits.
Conversely, securities other than shares declined by 97.46 per cent,
dragging the growth in M3 by 0.52 percentage point.

On the asset side, M3 growth was driven by increases in both NFA

and NDA. At ₦18.33 trillion, the NFA rose by 96.34 per cent,
contributing 11.35 percentage points to the overall growth in M3,
owing, largely, to revaluation effect.

43 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

The NDA rose by 18.73 per cent to ₦83.01 trillion, a 16.53

percentage points contribution to the growth in M3. The increase in
NDA was spurred by claims on other sectors, of which claims on
private sector accounted for the highest growth of 27.38 per cent,
contributing 14.29 percentage points to M3 growth. In addition,
claims on public non-financial corporations increased by 12.55 per
cent, contributing 0.50 percentage point to M3 growth.

Conversely, net claims on central government declined by 16.37 per

cent, owing to the growth in liabilities to central government by 27.69
per cent which outweighed the 1.30 per cent growth in claims on
central government.

44 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Table 11: Money and Credit Growth over preceding December

(per cent)
Contribution to
Annualised M3 Growth
Q2’23 Q4’23 Q1’24 Q2’24
growth (%) (percentage
Monetary
(%) point)
Aggregates (%) (%) (%)

(Q2’24) (Q2’24)

Net Foreign Assets 49.67 142.99 177.84 96.34 192.68 11.35

Claims on Non-residents 50.38 113.87 41.81 42.88 85.77 26.88

Liabilities to Non-
50.52 108.09 10.31 30.51 61.01 15.53
residents

Net Domestic
23.53 44.62 -5.25 18.73 37.47 16.53
Assets

Domestic Claims 31.04 45.31 -4.79 5.30 10.60 6.43

Net Claims on
35.70 41.61 -40.22 -16.37 -32.75 -6.93
Central Government

Claims on Central
28.21 63.30 -2.28 1.30 2.59 0.92
Government

Liabilities to Central
11.47 111.78 54.39 27.69 55.39 7.85
Government

Claims on Other
28.44 47.38 14.21 16.93 33.85 13.36
Sectors

Claims on Other
25.30 47.76 -4.44 -8.96 -17.93 -1.56
Financial Corporations

Claims on State and

-7.24 18.52 -2.49 2.24 4.49 0.12
Local Government

Claims on Public
34.03 -4.72 8.96 12.55 25.10 0.50
Nonfinancial Corporations

Claims on Private Sector 33.68 57.78 22.53 27.38 54.48 14.29

Total Monetary
25.46 51.86 16.32 27.88 55.76 27.88
Assets (M3)

Currency Outside
-11.88 33.67 5.66 10.38 20.76 0.45
Depository Corporations

Transferable Deposits 24.42 46.83 7.05 23.61 47.22 7.95

Narrow Money (M1) 19.93 45.20 6.89 22.10 44.20 8.40

Other Deposits 28.98 56.88 22.66 32.54 65.07 20.00

Broad Money (M2) 25.35 52.2 16.64 28.55 57.10 28.40

Securities Other than

39.40 7.04 -42.75 -97.46 -194.92 -0.52
Shares

Total Monetary
25.46 51.86 16.32 27.88 55.76 27.88
Liabilities(M3)

Source: Central Bank of Nigeria

45 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

2.3.2 Sectoral Credit Utilisation

Sectoral credit utilisation increased by 4.68 per cent to ₦55.71 trillion
Sectoral Credit in Q22024, relative to the level in the preceding quarter. The services
Utilisation
sector maintained dominance in receipt of credit, utilising 51.52 per
cent of the total credit, followed by industry and agriculture which
accounted for 44.10 and 4.38 per cent, respectively.

Table 12: Sectoral Credit Allocation

Growth
Allocation (₦ trillion) Share in Total (%)
(%)

SECTORS Q2’23 Q1’24 Q2’24 Q2’23 Q1’24 Q2’24

(3) & (2)
1 2 3 4 5 6

[a] Agriculture 1.84 2.58 2.44 4.91 4.85 4.38 -5.43

[b] Industry 16.31 22.49 24.57 43.53 42.25 44.10 9.25

of which
6.98 8.70 9.26 18.63 16.34 16.63 6.44
Manufacturing
[c] Services 19.32 28.15 28.70 51.56 52.90 51.52 1.95

of which:
3.48 3.41 6.16 9.27 6.41 11.06 80.65
Finance, Insurance &
Capital Market

Trade/General
2.88 3.80 3.57 7.70 7.14 6.40 -6.05
Commerce

TOTAL 37.48 53.22 55.71 100 100 100 4.68

Source: Central Bank of Nigeria

Consumer credit outstanding declined by 42.60 per cent to ₦4.73

Consumer trillion in Q22024, relative to the level in the preceding quarter.
Credit
Personal loans fell to ₦3.47 trillion, from ₦7.52 trillion in Q12024, but
remained dominant accounting for 73.35 per cent of the total
consumer credit. Retail loans, however, grew to ₦1.26 trillion from
₦0.72 trillion in the preceding period.

46 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Figure 30: Consumer Credit Outstanding

9.00 8.24
8.00
7.00
6.00
4.73
₦ Trillion 5.00
4.00 3.42
3.05
2.64
3.00
2.00
1.00
0.00
Q2'23 Q3'23 Q4'23 Q1'24 Q2'24

Personal Loan Retail Loan Total

Source: Central Bank of Nigeria

2.3.3 Financial Developments

2.3.3.1 Money Market Developments
Average banking system liquidity declined in Q22024, relative
Industry Liquidity to the level in the preceding quarter, due to cash reserve ratio
Condition
(CRR) debits, open market operations (OMO) sales and Nigerian
treasury bills (NTBs) sales. Outflow from the banking system via
CRR debits, OMO sales and NTBs sales, among others, moderated
liquidity in the banking system in the review period. Thus, average
closing industry balance fell by 6.90 per cent to ₦0.27 trillion in the
second quarter of 2024.

Activities at the standing lending facility (SLF) window declined,

while that of the standing deposit facility (SDF) window increased,
consistent with the liquidity level in the banking system. Total
transactions at the SLF window stood at ₦26.44 trillion in the review
period (with daily average of ₦0.51 trillion) from ₦31.40 trillion (with
daily average of ₦1.32 trillion) in the preceding quarter. Transactions
at the SDF window increased to ₦6.39 trillion (with daily average of
₦0.11 trillion) from ₦1.70 trillion (with daily average of 0.03 trillion) in
the preceding quarter.

47 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

Figure 31: Transactions at the Standing Facility Window

31.4
35.00
26.44
30.00
25.00
₦ Trillion
20.00
15.00
6.39
10.00 4.77
1.3 1.7
5.00
0.00
Q2'23 Q1'24 Q2'24
SLF SDF

Source: Central Bank of Nigeria

Analysis of the open market operations showed that the total amount
Open Market offered, subscribed, and allotted increased to ₦2.70 trillion, ₦4.94
Operations
trillion, and ₦4.36 trillion, respectively, from ₦1.45 trillion, ₦2.61
trillion, and ₦1.97 trillion in the preceding quarter. The increase in
subscription was driven by the higher stop rates of 20.62(±1.88) per
cent, from 15.75(±5.75) per cent.

Figure 32: Open Market Operation

4.94
5.00 4.36
₦ Trillion

4.00
2.61 2.70
3.00
1.45 1.97
2.00
1.00 0.00 0.00
0.00
0.00
Q2'23 Q1'24 Q2'24
Offer Subscription Allotment

Source: Central Bank of Nigeria

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ECONOMIC REPORT, SECOND QUARTER 2024

There was preference for longer-tenored government securities,

reflecting investors’ precautionary motive against rising inflation.
Government
Securities Total NTBs offered, subscribed, and allotted across tenors (91-, 182-
and 364-day) amounted to ₦1.47 trillion, ₦6.98 trillion and ₦2.81
trillion, respectively, compared with ₦2.21 trillion, ₦12.22 trillion, and
₦5.55 trillion, in the preceding quarter. The lower amounts offered
and subscribed were accompanied by increased stop rates on all the
maturities to 18.47(±2.23) per cent, from 11.97(±9.23) per cent in the
preceding quarter.

Figure 33: Primary Market NTBs (₦ Trillion)

15.00 12.22

10.00 6.98

4.62 5.55

5.00 2.21 1.47 2.81

1.05
1.12

0.00
Q2'23 Q1'24 Q2'24
Offer Subscription Allotment

Source: Central Bank of Nigeria

FGN Bonds of various tranches were offered during the quarter

under review. The amount offered, subscribed, and allotted were
₦1.35 trillion, ₦1.78 trillion, and ₦1.30 trillion, respectively, relative
to ₦3.31 trillion, ₦2.39 trillion, and ₦1.16 trillion in Q12024. The
marginal rates at 20.37(±1.13) per cent, were higher than
17.73(±2.73) per cent in the preceding quarter, and the bid rates
were 19.00(±5.00) per cent, against 20.50(±9.50) per cent in the
previous quarter.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 34: Primary Auctions of FGN Bond

4.00 3.31

3.00 2.39
₦ Trillion
1.56 1.78
2.00 1.08
1.35
1.30
1.16 1.16
1.00

0.00
Q2'23 Q1'24 Q2'24
Offer Subscription Allotment

Source: Central Bank of Nigeria

Key short-term interest rates rose, in line with the Bank’s restrictive
monetary policy stance. The average interbank call and open buy
back (OBB) rates increased to 28.43 and 28.65 per cent,
Interest Rate
Developments respectively, from 21.21 and 25.53 per cent in the preceding quarter.
At the Nigeria Interbank Offered Rate (NIBOR) segment, the NIBOR-
call and NIBOR-30 rates rose by 6.85 and 5.63 percentage points to
29.01 and 23.81 per cent, respectively, relative to the level in the
preceding quarter.

Figure 35: Developments in Short-term Interest Rates

30.00

25.00
Per cent (%)

20.00

15.00

10.00

5.00

0.00
Q4'22

Q1'23
Q1'21

Q2'21

Q3'21

Q4'21

Q1'22

Q2'22

Q3'22

Q2'23

Q3'23

Q4'23

Q1'24

Q2'24

Interbank Call OBB NIBOR Call

NIBOR-30day Upper Corridor Lower Corridor

Source: Central Bank of Nigeria

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ECONOMIC REPORT, SECOND QUARTER 2024

Provisional data indicated that average lending rates trended

upwards in the review quarter. The average prime and maximum
lending rates rose by 0.78 and 1.42 percentage points to 15.64 and
29.09 per cent, respectively, from the levels in the preceding quarter.
Similarly, the weighted average term deposit rate rose by 2.27
percentage points to 10.63 per cent. This resulted in a narrower
average spread of 18.46 percentage points between the weighted
average term deposit and maximum lending rates, relative to 19.30
percentage points in the preceding quarter.

Figure 36: Trend in Average Term Deposit and Lending Rates

30.00

25.00
Per cent (%)

20.00

15.00

10.00

5.00

0.00
Q1'21

Q2'21

Q3'21

Q4'21

Q1'22

Q2'22

Q3'22

Q4'22

Q1'23

Q2'23

Q3'23

Q4'23

Q1'24

Q2'24
PLR MLR WATD Spread

Source: Central Bank of Nigeria.

Note: PLR= Prime lending rate; MXLR= Maximum lending rate; WAVTD= Weighted Average term
deposit rate; and SPRD= Spread.

2.3.3.2 Capital Market Developments

Activities in the Nigerian equities market slowed in the second
Market quarter of 2024, reflecting portfolio switch from equities to fixed
Capitalisation
income securities. Aggregate market capitalisation increased from
N93.58 trillion to N104.28 trillion (11.43%) at end-June 2024,
underpinned by the appreciation in the debt segment of the capital
market, arising from improved returns on debt securities. The equities
component, however, sustained its dominance in terms of
contribution to the aggregate market capitalisation, despite the

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ECONOMIC REPORT, SECOND QUARTER 2024

impressive contribution of the debt segment. The equities component

constituted 54.28 per cent of the aggregate market capitalisation,
while debt and exchange traded funds (ETF) components constituted
the balance.

The equity and ETF components fell by 4.26 and 36.25 per cent,
respectively, to N56.60 trillion and N27.08 billion, compared with the
N59.12 trillion and N42.48 billion, recorded in the preceding quarter.
The debt component, however, grew by 38.42 per cent, to N47.65
trillion relative to the N34.42 trillion recoded at the end of the first
quarter of 2024. This reflected the shift in investors’ preference from
equities to fixed income securities due to attractive coupon rate and
yields.

Figure 37: Aggregate Market Capitalisation and All-Share

Index
120.00 120,000.00

100.00 100,000.00

80.00 80,000.00

Index Points
N' Trillion

60.00 60,000.00

40.00 40,000.00

20.00 20,000.00

0.00 0.00
Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024
Aggregate Market Cap (LHS) All Share Index (RHS)

Source: Nigeria Exchange (NGX) Limited

The All-Share Index (ASI) declined by 4.31 per cent to 100,057.49

NGX All- Share index points in the review quarter, underpinned by the elevated yield
Index
curve, which swayed investors to switch asset holdings from the
equities market to fixed-income securities.

Sectoral In the review quarter, most of the capital market indices were bearish
Indices except for NGX-MERI value, NGX-Oil/Gas and NGX-Sovereign bond

52 | P a g e Central Bank of Nigeria Economic Report Q22024

ECONOMIC REPORT, SECOND QUARTER 2024

which appreciated. The decline in most of the indices reflected the

rise in money market rates, which lowered preference for stocks.

Figure 38: Quarter-on-Quarter Changes in Per cent for Sectoral

Indices
% Change (Q-o-Q) 15.00
10.00
5.00
0.00
-5.00
-10.00
-15.00
-20.00
-25.00
NGX-SOVBND
NGX-ASEM
NGX-LOTUSISLM

NGX-MAINBOARD

NGX-30

NGX-CG
NGX-MERIGRW
NGX-AFRHDYI

NGX-AFRBVI
NGX-MERIVAL

NGX-INDUSTR

NGX-PREMIUM
NGX-PENSION
NGX-OILGAS

NGX-GROWTH

NGX-BNK
NGX-INS
NGX-CNSMRGDS

NGX-PENBRD
Source: Nigerian Exchange (NGX) Limited

Table 13: Nigeria Exchange (NGX) Limited Sectoral Indices

Sectoral Indices Q2 2023 Q2 2024 Change (%)
NGX-MERI Value 6,171.88 6,970.70 12.94
NGX-Oil/Gas 1,294.38 1,440.67 11.30
NGX-Sovereign Bond 730.80 766.01 4.82
NGX-ASeM 1,504.55 1,504.55 0.00
NGX-Lotus II 6,338.19 6,287.43 -0.80
NGX-Consumer Goods 1,610.80 1,581.55 -1.82
NGX-Main board 4,786.10 4,692.94 -1.95
NGX-Growth 5,703.31 5,576.43 -2.22
NGX-Pension Board 1,812.28 1,771.41 -2.26
NGX-Industrial Goods 4,841.20 4,696.04 -3.00
NGX-AFR Div Yield 11,006.66 10,652.71 -3.22
NGX-Insurance 405.94 390.57 -3.79
NGX-Premium 10,293.26 9,864.01 -4.17
NGX-Pension 3,934.33 3,762.21 -4.37
NGX-30 3,880.71 3,710.32 -4.39
NGX-MERI Growth 4,928.31 4,590.75 -6.85
NGX-CG 2,551.71 2,228.44 -12.67
NGX-AFR Bank Value 2,277.89 1,890.00 -17.03
NGX-Banking 1,029.63 830.20 -19.37
Source: Nigerian Exchange (NGX) Limited

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ECONOMIC REPORT, SECOND QUARTER 2024

Trading activities on the Exchange reduced in the review quarter as

the value of traded securities fell by 31.22 per cent to N528.40 billion.
Market
Transactions Similarly, the volume of traded securities dropped to 27.99 billion
shares, from 35.85 billion shares in the previous quarter. The total
number of deals traded fell by 32.11 per cent to 482,764.00 deals,
relative to the level in the preceding quarter.

Figure 39: Volume and Value of Traded Securities on the NGX

900.00 60.00
800.00
50.00
700.00

Billions Shares
600.00 40.00
N' Billion

500.00
30.00
400.00
300.00 20.00
200.00
10.00
100.00
0.00 -
Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024
Value of Traded Securities (LHS) Volume of Traded Securities (RHS)

Source: Nigeria Exchange (NGX) Limited

A total of 21 securities were listed on the Exchange (12 new listings

and 9 supplementary listings) comprising savings bonds, ordinary
NGX Listings
shares, rights issues and futures contracts. The new listings were
lower than the 13 new listings recorded in the preceding quarter, but
the supplementary listings exceeded the 8 recorded at end-March
2024. Additionally, the Exchange delisted all trading shares of Arbico
Plc.

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ECONOMIC REPORT, SECOND QUARTER 2024

Table 14: Listings and De-listings on the Nigerian Exchange

Limited in Q22024
Company/Security Shares Units/Price Remarks
19.94% FGN MAR 2027 Issued 151,928,000 units New listing
amounting to N151,928,000,000.
18.50% FGN FEB 2031 Additional 47,886,000 shares Supplementary listing
summing to 921,413,020
outstanding units as at April 12,
2024.
19.00% FGN FEB 2034 Additional 275,850,000 shares Supplementary listing
totalling to 897,232,074
outstanding units at April 12,
2024.
Royal Exchange Plc: Additional 3,121,328,866 ordinary Supplementary listing
shares of 50
Kobo each at N0.50 per share
AVA Infrastructure 4,075 units of N1,000,000 each New listing
Fund issued at par under the
N200,000,000,000.00 Issuance
Programme
17.046% FGS APRIL Issued 1,228,300 shares New listing
2026 amounting to N1,228,300,000
18.046% FGS APRIL Listed 2,985,658 shares New listing
2027 amounting to N2,985,658,000
Cadbury Nigeria Plc Listed additional 402,082,657 Supplementary listing
ordinary shares of 50 Kobo
each per share
Arbico Plc All trading shares Delisting
19.30% FGN APR 2029 Listed 79,915,301 shares New listing
amounting N79,915,301,000
18.50% FGN FEB 2031 85,050,449 additional units of Supplementary listing
shares.
19.00% FGN FEB 2034 461,848,303 additional units of Supplementary listing
shares.
International Breweries Rights Issue of New listing
Plc. 161,172,395,100 ordinary
shares of 2 Kobo each at N3.65

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ECONOMIC REPORT, SECOND QUARTER 2024

per share on the basis of six

new ordinary shares for every
existing one ordinary share.
19.89% FGN MAY Listed 464,124,560 shares New listing
2033 amounting to
N464,124,560,000.
19.30% FGN APRIL 69,170.285 additional units of Supplementary listing
2029 shares.
18.50% FGN FEB 2031 148,775,000 additional units of Supplementary listing
shares.
17.407% FGS MAY Listed 1,617,724 shares New listing
2026 amounting to N1,617,724,000.
18.407% FGS MAY Listed 4,325,384 units New listing
2027 amounting to N4,325,384,000
Multi-trex Integrated Listed additional 788,643,533 Supplementary listing
Foods Plc. ordinary shares of 50 kobo each
per share
Fidelity Bank Plc Rights Issue of 3,200,000,000 New listing
ordinary shares of 50 Kobo
each at N9.25 per share on the
basis of 1 new ordinary share
for every existing 10 ordinary
shares.
NGX30Z4 Listed futures contracts at New listing
N3,905.00
NGXPENSIONZ4 Listed futures contracts at New listing
N3,885.00
Source: Nigeria Exchange Limited (NGX).
Notes: FGN/FGS=Federal Government of Nigeria; Plc=Public Limited Liability Company.

2.3.3.3 Financial Soundness Indicators

The banking system remained safe, sound, and stable during
the review quarter. The capital adequacy ratio (CAR) improved by
1.47 percentage points to 12.52 per cent, in the review quarter, owing
to improvement in banks’ total qualifying capital and decrease in risk
weighted assets. The ratio remained above the 10.0 per cent

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ECONOMIC REPORT, SECOND QUARTER 2024

benchmark for banks with national/regional authorisation, but below

the 15.0 per cent threshold for banks with international authorisation.

Asset quality of banks, measured by the ratio of non-performing loans

(NPL ratio), improved to 3.90 per cent, relative to 5.05 per cent at
end-March 2024, owing to increased loan recoveries as banks
continued to comply with extant regulations. The ratio was robustly
below the prudential benchmark of 5.0 per cent.

The industry liquidity ratio (LR) grew by 1.52 percentage points to

43.59 per cent, relative to the level in the preceding quarter. The LR
remained above the minimum regulatory benchmark of 30.0 per cent,
indicating the ability of banks to meet their obligations.

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ECONOMIC REPORT, SECOND QUARTER 2024

2.4 External Sector Developments

The external sector performance improved in in Q22024, on
account of a higher current account balance and improved
capital flows. Consequently, the current account balance
Summary
posted a higher surplus of US$5.14 billion. In the financial
account, a net incurrence of financial liabilities was recorded,
driven by a rise in portfolio investment liabilities. At US$34.76
billion, the level of external reserves could cover 7.6 months of
import for goods and services or 10.9 months for goods only.
The average exchange rate at the NFEM depreciated by 5.86 per
cent to ₦1,385.96/US$, from ₦1,304.72/US$ in Q12024.

2.4.1 Current and Capital Account

The current account recorded a higher surplus position, due to
increase in the trade surplus, on account of lower import bills.
A higher current account surplus of US$5.14 billion (11.46% of GDP)
in Q22024, compared with US$3.38 billion (7.35% of GDP) in the
preceding quarter, due, largely, to a higher trade surplus and
increased surplus in the secondary income account.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 40: Current Account Balance (US$ Billion)

6.00

5.00
5.14

4.00

3.00 3.35 3.38

2.00

1.55
1.00
1.00

-
Q22023 Q32023 Q42023 Q12024 Q22024

Source: Central Bank of Nigeria

Merchandise export earnings declined in Q22024, primarily on

Export
Export
Performance account of fall in crude oil export receipts, following the drop in
Performance
domestic crude oil production. Aggregate export earnings
declined by 1.76 per cent to US$13.94 billion in Q22024, from
US$14.19 billion in Q12024. A breakdown of export receipts showed
that receipts from oil export fell to US$12.18 billion from US$12.42
billion in the preceding quarter, reflecting the decline in domestic
crude oil production to 1.27mbpd in Q22024 from 1.33mbpd in the
preceding quarter. The average spot price of Bonny light, however,
rose to US$86.97pb from US$85.58pb, cushioning the reduction in
oil export receipts. Receipts from non-oil exports also declined to
US$1.76 billion, from US$1.77 billion in Q12024, attributed to the
decline in other non-oil export receipts, particularly, agricultural
products. Analysis by share of total export indicated that crude oil
and gas exports continued to dominate, constituting 87.38 per cent,
while non-oil exports accounted for the balance.

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ECONOMIC REPORT, SECOND QUARTER 2024

Merchandise import decreased in Q22024, following the decline

Merchandise in the import of petroleum products. Merchandise imports

Import decreased by 20.59 per cent to US$8.64 billion, from US$10.88
billion in Q12024. Analysis by composition indicated that oil imports
decreased to US$2.79 billion, from US$4.31 billion in the preceding
quarter. Non-oil imports also declined to US$5.85 billion, from
US$6.57 billion in the previous quarter. A breakdown of total import
showed that non-oil imports accounted for 67.72 per cent, while oil
imports constituted the balance.

Further analysis indicated that the industrial sector, mainly raw

materials and machinery, accounted for the largest share of imports,
with 51.25 per cent. This was followed by food products (15.36%),
manufactured products (13.15%), oil sector (11.94%), minerals
(4.21%), transport (3.14%), and agricultural products (0.95%).

Figure 41: Import by Classification in Per cent

Transport, 3.14% Agriculture , 0.95%

Minerals , 4.21%

Oil sector ,
11.94%

Manufactured
products , 13.15% Industrial sector ,
51.25%

Food products ,
15.36%

Source: Central Bank of Nigeria

The deficit in the services account widened, reflecting

Services increased payments for other business and government
services. The deficit in the services account widened to US$3.47

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ECONOMIC REPORT, SECOND QUARTER 2024

billion, from US$3.26 billion in Q12024. A disaggregation showed

that total payment for services increased by 0.80 per cent to US$4.57
billion, relative to the level in the preceding quarter. A breakdown of
the components of services indicated that out-payment for other
business services increased significantly to US$1.41 billion from
US$0.71 billion in Q22024. Payments for government goods and
services increased to US$0.20 billion relative to US$0.11 billion in
Q12024, while travel services increased to US$1.10 billion (4.76%).
Payments for financial services, insurance & pension services and
telecommunication services, however, declined to US$0.13 billion
(18.75%), US$0.12 billion (14.29%), and US$0.10 billion (9.09%),
respectively.

Analysis of total payment for services showed that transport services

accounted for 31.31 per cent, followed by other business services
(30.77%), travel services (23.96%), and government goods &
services (4.44%) Other contributors were financial services (2.92%),
insurance & pension services (2.64%), and telecommunication
(2.08%), while “others” accounted for the balance.

Figure 42: Share of Service Out-Payments in Per cent

Telecommunicati Others, 1.88 Government
on, 2.08 goods and
Financial services, 4.44
services, 2.92
Insurance and
pension, 2.64
Transportation,
Other business 31.31
services, 30.77

Travel, 23.96

Source: Central Bank of Nigeria.

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ECONOMIC REPORT, SECOND QUARTER 2024

Receipts from services increased by 13.40 per cent, to US$1.10

billion, in Q22024, driven, mainly, by higher inflows from financial
services. Receipt from financial services increased by 60.00 per cent
to US$0.24 billion, transportation services rose by 5.66 per cent to
US$0.56 billion, and travel services by 12.50 per cent to US$0.09
billion. Receipts from government goods & services and other
business services, however dropped by 7.69 and 33.33 per cent to
US$0.12 billion and US$0.02 billion, respectively, relative to the
levels in the preceding quarter.

Of the total services receipts, transportation services constituted

50.98 per cent, followed by financial services (21.32%), government
goods & services (10.83%), travels (8.42%), and telecommunication
services (4.30%). Other services accounted for the balance.

Figure 43: Share of Services Receipts in Per cent

Government Others
goods and 4.15%
Telecommunica services
tion 10.83%
4.30%

Transportation
Financial 50.98%
services
21.32%
Travels
8.42%

Source: Central Bank of Nigeria.

The deficit in the primary income account widened, reflecting

Primary Income
higher reinvested earnings by non-resident investors. The
deficit in the primary income account increased by 2.07 per cent to
US$2.47 billion from US$2.42 billion in Q12024, following higher

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 ECONOMIC REPORT, SECOND QUARTER 2024

reinvested earnings by non-resident investors. A disaggregation

showed a higher deficit of US$2.54 billion in the investment income
sub-account, relative to US$2.48 billion in Q12024, Compensation
of employees account showed a surplus of US$0.07 billion which
was 12.61 per cent, higher than the level in the preceding quarter.

Figure 44: Primary Income Balance (US$ Billion)

(0.50)

(1.00)

(1.50)

(2.00) (1.80)

(2.50) (2.42) (2.47)

(3.00) (2.85)
(3.23)
(3.50)
Q22023 Q32023 Q42023 Q12024 Q22024

Source: Central Bank of Nigeria.

The secondary income account posted an increased surplus

position in Q12024 due to higher inflow of remittances. At
Secondary Income
US$5.78 billion, the secondary income account surplus was 0.34 per
cent above the level in Q12024. The development was attributed to
a higher inflow of private sector transfers, particularly workers’
remittances, which increased to US$5.35 billion, from US$5.14
billion in Q12024. General government transfers, however,
decreased by 26.47 per cent to US$0.50 billion from US$0.68 billion
in the preceding quarter.

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ECONOMIC REPORT, SECOND QUARTER 2024

Figure 45: Secondary Income Balance and Remittances Inflow

(US$ Billion)

5.74 5.76 5.78

6.0 5.58
5.31 5.35
5.14
4.95 4.90
5.0 4.58

4.0

3.0

2.0
0.…
0.71 0.81 0.68
1.0 0.5

0.0
Q22023 Q32023 Q42023 Q12024 Q22024

Secondary income balance Remittances Government transfers

Source: Central Bank of Nigeria.

2.4.2 Financial Account

The financial account recorded a net incurrence of financial
Financial
liabilities, following a rise in portfolio investment liabilities,
Account
Developments particularly, debt securities, due to competitive rates. The
financial account recorded a net incurrence of financial liabilities of
US$2.27 billion, in contrast to a net reduction in liabilities of US$5.03
billion in Q12024.

The economy recorded a net inflow of US$4.70 billion, relative to the

Net Incurrence
of Liability net reduction of US$6.10 billion recorded in the preceding quarter.
The development was due to higher inflow through the purchase of
short-term debt securities by non-resident investors. A
disaggregation showed that portfolio investment liabilities increased
to US$4.42 billion, from US$1.40 billion in Q12024, while foreign
direct investment liabilities increased to US$0.56 billion, from a
divestment of US$0.30 billion in Q12024. ‘Other investment’
liabilities posted an outflow of US$0.25 billion, relative to an outflow

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ECONOMIC REPORT, SECOND QUARTER 2024

of US$7.09 billion in Q12024, due to withdrawal of foreign currency

and deposits by banks.

Net Acquisition
Financial assets totalling US$1.89 billion was acquired by resident
of Asset investors in Q22024, as against a disposal of US$1.34 billion in the
preceding quarter. The development followed an accretion to
reserve assets of US$2.47 billion, in contrast to a depletion of
US$0.95 billion in Q12024. Direct investment assets recorded a
higher disposal of US$0.83 billion, relative to US$0.72 billion in the
preceding quarter. Portfolio investments recorded a net acquisition
of US$0.21 billion, in contrast to a reversal of US$0.15 billion in
Q12024. ‘Other investment’ asset also recorded an acquisition of
US$0.01 billion, compared with US$0.50 billion in the preceding
quarter.

2.4.3 External Debt

At end-March 2024, Nigeria’s external debt stock stood at US$42.16
External Debt billion (22.90% of GDP). A breakdown showed that the multilateral
loans, including loans from the World Bank Group, International
Monetary Fund, and African Development Bank Group, amounted to
US$20.83 billion, accounting for 49.45 per cent of the total.
Commercial loans (Euro Bonds) was US$15.12 billion or 35.90 per
cent of the total. Loans from bilateral sources was US$5.90 billion,
or 14.01 per cent of the total, and syndicated loans (African Finance
Corporation) stood at US$0.27 billion or 0.64 per cent of the total
external debt stock.

External debt service payments at end-March 2024 stood at

US$1.12 billion, compared with US$0.94 billion in the preceding
quarter. Of this, interest payments totalled US$0.43 billion (38.39%
of debt service), while principal repayments totalled US$0.64 billion
(57.14% of debt service). ‘Other payments’ accounted for the

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balance. A disaggregation of interest payments showed that interest

on commercial borrowings accounted for US$0.29 billion (67.44%),
bilateral loans was US$0.09 billion (20.93%), while interest
payments to multilateral institutions accounted for the balance.

2.4.4 International Investment Position (IIP)

The international investment position posted a lower net
financial liability of US$66.43 billion. The stock of financial assets
increased to US$104.30 billion from US$102.38 billion in the
preceding quarter due, largely, to an accretion to reserve assets. At
US$4.37 billion, portfolio investment assets was 5.01 per cent above
the level in the preceding quarter, while other investment assets also
increased to US$48.45 billion from US$48.41 billion in the preceding
quarter. Direct investment assets, however, fell to US$16.57 billion
from US$17.40 billion in the preceding quarter.

The stock of financial liabilities increased to US$170.73 billion from

US$170.38 billion in Q12024, attributed, mainly, to the 10.76 per cent
increase in portfolio investment liabilities. At US$66.09 billion, the
stock of direct investment was below US$67.84 billion recorded in
Q12024. ‘Other investment’ liabilities also declined to US$73.92
billion from US$74.77 billion in Q12024.

2.4.5 External Reserves

The external reserves grew and remained above the benchmark
International
Reserves of 3 months of import cover during the review period. The
external reserves rose to US$34.76 billion, from US$32.29 billion at
end-March 2024. This level of reserves could cover 7.89 months of
import for goods and services or 12.09 months for goods only.

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Figure 46: External Reserves and Months of Import Cover

35 14.00
34.5
12.00
34
10.00

US$ Billion
33.5

33 8.00

32.5
6.00
32
4.00
31.5

31
2.00

30.5 0.00
Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024

External Reserves - LHS

Months of Import (Goods)-RHS
Months of Import (Goods and Services)-RHS

Source: Central Bank of Nigeria

A breakdown of the external reserves showed that the shares of the

CBN and the Federal Government stood at US$29.75 billion and
US$5.02 billion, respectively, while the Federation accounted for the
balance. A disaggregation of external reserves by currency showed
the continued dominance of the: US dollar with US$26.65 billion
(76.65%), followed by Special Drawing Rights (US$4.23 billion or
12.16%), Chinese yuan (US$3.25 billion or 9.34%), Euro (US$0.36
billion or 1.05%) and British pounds (US$0.28 billion or 0.80%).
Other currencies accounted for the balance.

2.4.6 Foreign Exchange Flows through the Economy

Net foreign exchange inflow through the economy rose in the
Foreign review period, driven largely by inflow through the autonomous
Exchange Flows
sources. Foreign exchange inflow through the economy increased
to US$24.55 billion, from US$22.26 billion in Q12024. Inflows
through autonomous sources and the Bank increased to US$16.12
billion and US$8.43 billion, respectively, from US$14.17 billion and
US$8.09 billion in the preceding quarter.

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Foreign exchange outflow through the economy fell by 31.51 per

cent to US$7.37 billion, relative to the level in Q12024. Outflows
through autonomous sources and the Bank decreased by 8.79 and
36.06 per cent, respectively, to US$1.66 billion and US$5.71 billion
in the review quarter.

Consequently, net foreign exchange inflow through the economy

increased by 49.39 per cent to US$17.18 billion, from US$11.50
billion in the preceding quarter. Similarly, net inflow through
autonomous sources rose to US$14.46 billion, from US$12.35 billion
in the preceding quarter. A net inflow of US$2.72 billion was recorded
through the Bank, compared with a net outflow of US$0.85 billion in
the preceding quarter.

Figure 47: Foreign Exchange Transactions through the

Economy (US$ Billion)
45.00
40.00
35.00
30.00
25.00
20.00
15.00
10.00
5.00
-
Q2 2023 Q1 2024 Q2 2024
Inflow 40.46 22.26 24.55
Outflow 21.93 10.76 7.37
Netflow 18.52 11.50 17.18

Inflow Outflow Netflow

Source: Central Bank of Nigeria

The average turnover at the Nigerian Foreign Exchange Market

(NFEM) rose by 3.83 per cent to US$204.43 million, relative to
US$196.88 million in Q12024, reflecting increased trading activities
in the market.

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Figure 48: Turnover in the I&E Foreign Exchange Market

250.00 80.00
69.52
200.00 60.00

PERCENT
US $ (M)
40.00
150.00
23.26 20.02 20.00
100.00 3.83 -
50.00 (20.00)
(24.39)
- (40.00)
Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024

Average Turnover(LHS) Rate of Turnover(RHS)

Source: Central Bank of Nigeria.

2.4.7 Exchange Rate Movement

Average The average exchange rate at the NFEM depreciated by 5.86 per
Exchange Rate cent to ₦1,385.96/US$, from ₦1,304.72/US$ in Q12024, owing to
demand pressure.

The Russian rubble and the South African rand appreciated by 0.28

Emerging Market and 10.61 per cent, respectively, against the US dollar, relative to
Currencies the levels in the preceding quarter. The appreciation of both
currencies was due, mainly, to the decision of the US Fed to hold
rates, which made the rubble and rand denominated assets relatively
more attractive to investors. The Chinese yuan, however,
depreciated by 0.80 per cent due to investors’ expectations that the
People’s Bank of China would devalue the yuan amidst a downturn
in the real estate sector.

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Figure 49: Selected EMEs Currency Values to the US dollar

20.00
Chinese RMB Nigerian Naira
South African Rand Russian Ruble
10.00

Depreciation/Appreciation
0.00

-10.00

-20.00

-30.00

-40.00
Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024

Sources: Central Bank Nigeria & Reuters

Table 15: Selected EMEs Currency Rates to the US dollar

Period Chinese Nigerian South Russian
yuan naira African ruble
rand
Q2 2023 7.01 511.23 18.70 81.20

Q1 2024 7.15 1304.72 20.54 91.03

Q2 2024 7.21 1385.96 18.57 90.78

Sources: Central Bank of Nigeria & Reuters

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3.0 Economic Outlook

3.1 Global Outlook
The Global economy is projected to remain resilient for the rest
of the year, albeit with regional variations.7 Global growth in 2024
and 2025 is projected at 3.20 per cent, owing to resilience to adverse
shocks, coupled with expected resumption of policy rate easing as
inflation moderates. The downside risks to the outlook include
potential reduction in labour demand and geopolitical uncertainties.

Growth in AEs is anticipated to quicken to 1.70 per cent in 2024 from

1.60 per cent in 2023, on the backdrop of strong consumer demand,
steady employment growth, rising real income and asset prices. In
EMDEs, growth is projected to moderate to 4.20 per cent in 2024
and 2025 from 4.30 per cent in 2023. Higher growth is expected for
the Middle East and Central Asia, as well as Sub-Saharan Africa,
whereas emerging and developing Asia is projected to witnessed
moderate growth.

Global inflation pressure is expected to ease in 2024, on the

back of tight monetary policy stance. Inflation is projected to fall
to 5.90 per cent in 2024, from 6.80 per cent in 2023, owing to
anticipated lower international commodity prices and the effect of the
restrictive monetary policy stance across regions. In most AEs,
inflation is expected to return to target levels due to more effective
monetary policy measures and a faster resolution of supply-side
challenges. Structural challenges and higher sensitivity to global
commodity price fluctuations could slow the rate of disinflation in
EMDEs.

7
The IMF World Economic Outlook April 2024.

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3.2 Domestic Outlook

Economic growth prospects for Nigeria remains positive
despite headwinds. The anticipated increase in crude oil output and
prices support the optimistic view. It is also expected that the effects
of the tax reforms, alongside the broad-based fiscal reforms will
boost growth. The downside risk to this outlook includes global
uncertainties, insecurity, sustained monetary tightening and the
elevated costs of energy, transportation and logistics.

Inflationary pressures are expected to moderate within the short

term, largely due to the restrictive monetary policy measures and
base effect. The impact of climate change on agricultural output,
heightening insecurity and off-cycle elections, and rising energy
costs are downside risks to inflation outlook.

The external position of Nigeria is expected to remain

optimistic, driven by expected increase in domestic crude oil
production and favourable crude oil prices. In addition, the gains from
capital flows and remittances, on the back of continued
implementation of policy reforms in the sector would support the
positive outlook for external reserves. Nonetheless, the risks of
capital reversals could be heightened by the delayed interest rate
cuts in advanced economies and on escalation of geopolitical
tensions.

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