The naira has appreciated by 25% in the parallel market in 10 weeks, but economic activity is lagging the currency gains.
Skeptical Nigerians are wondering whether this naira momentum is sustainable. This is because a strong currency is not necessarily synonymous with a strong economy. The good news is that inflation is sliding and the FBN PMI, a measure of manufacturers’ confidence spiked by 6% to 58.9. More importantly, oil production is reported to be 2mbpd, a 32-month high.
These indicators confirm the notion that the long anticipated economic recovery may have started ahead of analysts’ expectation. This recovery however is vulnerable to exogenous and domestic political shocks.
In this edition of the LBS executive breakfast club, Bismarck Rewane and the FDC Think Tank analyze pressing issues and trends, and identify the implication on market performance and socio/political developments.