Nigeria’s reforms are expected to support a turnaround in its credit story in 2024, a new report by Standard Chartered has said.
In its global economic focus on 2024 report, the British multinational bank said the reform agenda in Africa’s biggest economy will bolster macroeconomic stability and tap into the nation’s substantial investment opportunities.
“Foreign exchange reforms, cash reforms, and other economic reforms being undertaken by the present Government in Nigeria could help attract capital inflows and gradually address FX liquidity challenges,” the report said.
The bank noted that the headline Consumer Price Index, which measures the inflation rate, is expected to decelerate in 2024 in most key economies, adding that base effects, recently receding energy price inflation, and the lagged effects of policy tightening will help to slow price pressures.
It said: “Oil prices are a key source of upside inflation risk. Analysts expect the average Brent crude oil price to fall to $81/b in December 2024 and fall below $80/b in 2nd Half of 2025 due to expected inventory builds in 2025.
“However, recent activity in the Red Sea causing further tension in the Middle East could see a near-term upside to the risk premium. Despite expectations of slightly softer global growth in 2024, support for oil is still considerable.”
According to Standard Chartered, global oil demand is expected to remain strong, helped by firm growth in Asia adding that any escalation of geopolitical risks could put further upward pressure on prices.
