Nigeria: Business confidence declines in June
June 30, 2015
In June, the Business Sentiment Indicator (BSI) developed by MNI Indicators and Standard Chartered fell from May’s 61.4 to 60.7, which marked the lowest level in four months. Nevertheless, the indicator is resting comfortably above the 50-threshold that separates contraction from expansion in business conditions.
June’s reading reflected a slight deterioration in new orders and order backlogs. On the other hand, production and job conditions remained strong in the same month. Meanwhile, input prices climbed to a series high in June, mainly due to the weakening of the naira, which boosted prices for imported goods. On the other hand, despite a weak currency, export orders declined again in June.
According to MNI Indicators and Standard Chartered analysts, companies point to low availability of U.S. dollars, which is hurting business, and stress that this situation will not change in the near future. Although data suggest that, “post-election euphoria is starting to fade,” growth is likely to pick up in the second half of the year as, “businesses remain optimistic on the likelihood of an economic turnaround.”