Global Macroeconomic Review
United States: The U.S. economy entered 2025 with strong momentum, reflected in the surging U.S. dollar, robust labor market performance, and persistent inflation concerns. The dollar soared to a two-year high as the Federal Reserve maintained a cautious stance on rate cuts, emphasizing economic resilience and inflationary persistence. Market optimism was further fueled by President-elect Donald Trump’s pro-growth policies, expected to amplify economic activity and inflationary pressures…
United Kingdom: The UK economy faced significant headwinds in early 2025 as monetary policy divergence between the Bank of England (BoE) and the Federal Reserve weighed on the pound. Expectations of substantial rate cuts by the BoE led to a depreciation of sterling, exacerbating inflationary concerns. The pound’s weakness made imports more expensive, further straining household budgets already grappling with elevated living costs…
Domestic Macroeconomic Review
Persistent inflationary pressures; GDP Rebasing and Refinery Revival.
In December 2024, Nigeria’s inflation rate rose to 34.80% y/y, an increase from 34.60% in November. This marks the fourth consecutive monthly rise and represents the highest level recorded in over six months. This uptick can largely be attributed to increased consumer demand during the festive season, which led to higher prices for a range of goods and services…
Market Update
Foreign Exchange Market: In January, the Nigerian Foreign Exchange Market (NFEM) demonstrated relative stability, supported by improved liquidity from Foreign Portfolio Investors (FPIs), International Oil Companies (IOCs), and Central Bank of Nigeria (CBN) interventions. The Naira fluctuated within a broad range of $/₦1,440.00 to $/₦1,570.00, with notable strengthening mid-month as increased supply eased demand pressures…
Money Market: Interbank liquidity exhibited significant fluctuations, driven by various inflows and liquidity tightening measures. Early in the month, inflows from Remita, FAAC payments, and OMO maturities provided temporary relief, lowering interbank rates. However, liquidity pressures resurfaced due to aggressive tightening by the Central Bank, including ₦500 billion and ₦1 trillion OMO auctions, FGN bond settlements, and net CRR debits…
