The Nigerian economy recorded another positive growth over the first quarter of 2021, marking the second consecutive quarter of expansion (+0.51% YoY) since the last recession (Q3- 2020: -3.62%).
Although the non-oil sector remained the major driver for overall growth, we highlight that the sector’s growth of 0.79% YoY was slower relative to the previous quarter (Q4 2020: 1.69% YoY).
The oil sector on the other hand contracted by 2.21% YoY (Q4 2020: -19.76% YoY) owing to a sustained decline in oil production. Specifically, average daily oil production declined by 0.35mbpd to 1.72mbpd, stemming from increased compliance with the OPEC+ production cut.
Headline inflation for the month of April moderated by 5bps to 18.12% YoY (March: 18.17% YoY). We highlight that this is the first decline after the 19 consecutive months of expansion.
Read Also: What Nigeria can do in 3-6 months to soften inflation
Although food inflation was the major driver for the moderation (-23bps YoY to 22.72%), we believe pressure persists as security remains a major challenge in food-producing states within the federation.
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Furthermore, FX illiquidity continues to remain a major concern and has been a major driver of the price of imported products.
These and other key variables will be discussed at the second edition of the Alpha Morgan Capital Managers Limited quarterly wealth and economic review holding on Tuesday, June 29th, 2021. We invite you to join us at this webinar as we delve into the facts behind the figures and help participants better understand the present and potential future trajectory of the Nigerian economy.
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