Dear Subscriber,

One of the key considerations for the MPC maintaining status quo after 22 months, is the fear of the disruptive effects of an expansionary budget at a time of likely simmering inflationary pressures.

The 2018 budget, which has been unusually delayed for 7 months, has become a subject of acrimony between the executive and legislative arms of government. The negative impact of the increased spending of 6% to N9.1trn has been grossly exaggerated. The total expenditure of N9.1trn is only 7.36% of GDP and is unlikely to be as devastating as being bandied.

Notwithstanding these issues, the fact that oil is now trading above $78pb, a 3 and a half -year high is comforting to markets and policy makers. The naira is expected to stabilize after initial fears and jitters that saw it slide to N366/$.

In this edition of the FDC monthly publication, the FDC Think-Tank analyzes these issues and their implications on businesses and investments.

Enjoy your read….