Global Macroeconomic Review
United States: The U.S. economy in early 2025 showed mixed signals. Manufacturing rebounded after 27 months, with the ISM Manufacturing PMI improving, while the ISM Services PMI dipped slightly but stayed in growth territory. The job market remained strong, with unemployment dropping to 4.0%, though job openings fell to a three-month low and only 143,000 jobs were added in January, far fewer than December’s 307,000…
United Kingdom: The UK economy showed slow recovery with unexpected inflation challenges in early 2025. In late 2024, the economy grew 0.1%, driven by services and construction, leading to a 0.9% annual GDP increase. This growth, though surprising, faced ongoing issues. The Bank of England (BoE) cut interest rates to 4.5% to support growth while tackling inflation…
Domestic Macroeconomic Review
CPI Rebasing; Economic Resilience; Increased Oil production; MPC Halts Rate Hike; Budgetary Reforms.
Nigeria’s economy in early 2025 showed signs of resilience, with headline inflation dropping to 24.48% year-on-year (y/y) in January, down from 34.80% in December 2024. This decline, the first significant reduction in months, was driven by the rebasing of the Consumer Price Index (CPI) to reflect 2024 as the base year, alongside updated weights for goods and services. Food inflation fell to 26.08% y/y, while core inflation dropped to 22.59% y/y, offering some relief to households. However, the lower inflation rate reflects slower price increases rather than actual price reductions, meaning Nigerians still face high living costs…
Market Update
Foreign Exchange Market: The Nigerian Foreign Exchange Market (NFEM) was marked by fluctuations driven by liquidity conditions and regulatory interventions. Early in the month, demand pressure persisted, causing the naira to depreciate to ₦1,500.41/USD despite trades fluctuating between ₦1,437.70/USD and ₦1,541.00/USD. The Central Bank of Nigeria (CBN) responded by extending the BDC FX purchase window to May 2025, capping weekly purchases at $25,000 per operator to enhance market stability. Mid-month, the CBN and International Oil Companies (IOCs) boosted foreign exchange supply, easing liquidity constraints…
Money Market: The interbank market faced persistent liquidity challenges throughout February, driven by significant outflows from OMO and FGN bond settlements. The month began with a liquidity shortfall following a ₦1 trillion OMO auction and CRR deductions, pushing the Overnight Policy Rate (OPR) and Overnight Rate (OVN) above 32%…
