ECONOMIC REPORT
THIRD QUARTER 2015


CENTRAL BANK OF NIGERIA


C e n t r a l B a n k o f N i g e r i a
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Economic Report Third Quarter

The Central Bank of Nigeria Quarterly Economic Report is designed for the dissemination
of financial and economic information on the Nigerian economy on current basis. The
Report analyses developments in the financial, fiscal, real and external sectors of the
economy, as well as international economic issues of interest. The Report is directed at
a wide spectrum of readers including economists and financial analysts in government
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Economic Report Third Quarter

Contents


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Text Tables
Appendix Tables


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Figures


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1.0 Summary
Provisional data indicated that growth in the key monetary
aggregate decelerated in the third quarter of 2015. Over the level at
the end of the preceding quarter, broad money supply, (M2),
declined by 0.5 per cent, compared with the decline of 1.7 per cent
at the end of the preceding quarter. The development was
attributed to the the 14.6 per cent fall in foreign assets (net), which
more than offset the 0.5 and 7.8 per cent growth in domestic credit
and other assets (net) of the banking system, respectively. Over the
level at end-December 2014, growth in M 2 contracted by 1.0 per
cent.
Available data indicated that banks’ deposit and lending rates
trended upward during the third quarter of 2015. The spread
between the weighted average term deposit and maximum lending
rates narrowed by 0.87 percentage points to 17.78 percentage
points at the end of the third quarter of 2015. However, the margin
between the average savings deposit and the maximum lending
rates, widened by 0.39 percentage point to 23.35 percentage
points. The weighted average inter-bank call rate fell by 0.95
percentage point to 16.39 per cent in the third quarter of 2015,
reflecting the liquidity condition in the inter-bank funds market.
Provisional data indicated that the value of money market assets
outstanding at the end of the third quarter of 2015 rose by 10.2 per
cent to N9,033.03 billion, in contrast to the decrease of 1.33 per cent
at the end of the preceding quarter. The development was
attributed to the 17.89 per cent increase in FGN Bonds outstanding.
Available data indicated that developments in the Nigerian Stock
Exchange (NSE) were bearish as market indicators trended
downward during the review period.
Provisional total federally-collected revenue stood at N1,913.15
billion, which was lower than the quarterly budget estimate of
N2,444.60 by 21.7 per cent. However, this exceeded the receipts in
the preceding quarter by 36.9 per cent. At N949.45 billion or 49.6 per
cent of the total revenue, gross oil receipt was lower than the
provisional quarterly budget by 30.1 per cent. However, this
exceeded the receipts in the preceding quarter by 13.2 per cent.
The decline in oil revenue relative to the quarterly budget estimate
was attributed to the persistent fall in receipts from crude oil/gas
export, due to the continous drop in the price of crude oil in the
international market.


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Economic Report Third Quarter

Non-oil receipts, at N963.70 billion, was lower than the 2015 quaterly
budget estimate by 11.3 per cent, but exceeded the level in the
preceding quarter by 72.6 per cent. Federal Government retained
revenue was N676.66 billion, while total expenditure was N963.13
billion. Thus, the fiscal operations of the Federal Government resulted
in an estimated deficit of N286.47 billion in the third quarter of 2015,
compared with the 2015 quarterly budget deficit of N260.25 billion.
The agricultural sub-sector witnessed increased level of activities as a
result of widespread rainfall in most parts of the country in the third
quarter of 2015. Major agricultural activities in the southern states
were harvesting of maize and yam, while harvesting of potatoes
and groundnuts was dominant in the central and northern states.
Nigeria’s crude oil production, including condensates and natural
gas liquids, was estimated at an average of 1.95 million barrels per
day (mbd) or 179.40 million barrels (mb) for the third quarter. Crude
oil export was estimated at 1.50 mbd or 138.00 million barrels, while
deliveries to the refineries for domestic consumption remained at
0.45 mbd or 41.4 million barrels during the review quarter. The
average price of Nigeria’s reference crude, the Bonny Light (370
API), fell by 17.8 per cent below the level in the preceding quarter.
World crude oil demand was estimated at 93.47 mbd in the third
quarter of 2015, representing an increase of 1.6 per cent above the
92.03 mbd recorded in the second quarter of 2015. World crude oil
supply was estimated at 94.6 mbd in the third quarter, representing a
marginal decrease of 0.2 per cent below the level recorded in the
second quarter of 2015. The development was attributed to the high
gasoline demand in the US and China as a result of massive car sales
during the period, supported by lower oil prices.
The end-period headline inflation rate for the third quarter of 2015,
on year-on-year basis, was 9.4 per cent, compared with 9.2 and 8.3
per cent at the end of the preceding quarter and the
corresponding quarter of 2014, respectively. The inflation rate on a
12-month moving average basis was 8.7 per cent, compared with
8.4 per cent at the end of the preceding quarter.
Provisional data indicated that foreign exchange inflow and outflow
through the Central Bank of Nigeria (CBN) amounted to US$11.11
billion and US$9.52 billion, respectively, resulting in a net inflow of
US$1.59 billion. Foreign exchange sales by the CBN to the authorized
dealers amounted to US$8.04 billion, compared with US$10.2 billion in
the preceding quarter. The average exchange rate of the naira visà-vis the US dollar at the inter-bank and BDC windows were N196.99
and N225.21 per US dollar in the review quarter. Relative to the levels


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Economic Report Third Quarter

in the preceding quarter, this indicated respective depreciation of
0.01 and 3.9 per cent at the inter-bank and bureau-de-change
segments of the market.
The global economy continued to be affected by the decline in oil
prices, appreciation of the dollar, slowdown in China, uncertainty in
Europe and anticipation of a shift in US monetary policy. The
International Monetary Fund (IMF) World Economic Outlook (WEO)
July 2015, projected global growth at 3.3 per cent in 2015. Growth is
expected to strengthen to 3.8 per cent in 2016.
Other major international economic developments and meetings of
importance to the domestic economy during the review period
included: the United Nations third International Conference on
Financing for Sustainable Development held in Addis Ababa,
Ethiopia, from July 13 – 16, 2015; the United Nations General Asembly
held in New York, United States, from September 25 to 27, 2015; the
meeating of the board of directors of the African Developmnet Bank
held at the Bank’s headquarters in Abidjan, Ivory Coast on July 8,
2015; the African Caucus meeting of the International Monetary
Fund (IMF) and World Bank Group (WBG) which took place in
Luanda, Angola, from August 27 - 29, 2015; and a High Level
Stakeholder Consultative Meeting of African business and political
leaders held at the AfDB headquarters in Abidjan, Ivory Coast on
September 17, 2015.


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2.0 Financial Sector Developments
2.1 Monetary and Credit Developments
Provisional data indicated that growth in the key monetary
aggregate decelerated at the end of third quarter of 2015.
Developments indicated that banks’ deposit and lending rates
trended upward during the review quarter. The value of money
market assets outstanding increased, due largely, to the rise in FGN
Bonds. Developments in the Nigerian Stock Exchange (NSE) were
bearish as market indicators trended downward.
Provisional data indicated that growth in the key monetary
aggregate decelerated at the end of the third quarter of
2015. On quarter-on-quarter basis, broad money supply, (M2),
at N18,718.0 billion, fell by 0.5 per cent, compared with the
decline of 1.7 per cent at the end of the preceding quarter.
The development was attributed to the 14.6 per cent decline
in foreign assets (net) of the banking system, which more than
offset the growth of 7.8 and 0.5 per cent in other assets (net)
and net domestic credit of the banking system, respectively.
This, however, contrasted with the growth of 3.6 per cent at
the end of the corresponding quarter of 2014. Over the level
at end-December 2014, broad money supply (M2), fell by 1.0
per cent.
Relative to the level at the end of the preceding quarter,
narrow money supply (M1), rose by 9.3 per cent to N7,148.6
billion, at the end of the third quarter, in contrast to the 6.3 per
cent decline at the end of the preceding quarter. The
development, was attributed to the respective growth of 2.9
and 10.7 per cent in its currency and demand deposit
components. Over the level at the end-December 2014, M 1
rose by 3.5 per cent, in contrast to the decline of 5.3 per cent
at the end of the preceding quarter. The development was
attributed to the 8.5 per cent increase in the demand
deposits component.
Relative to the level at the end of the preceding quarter,
quasi money fell by 5.7 per cent to N11,569.4 billion at the end
of the third quarter, in contrast to the 1.0 per cent growth at
the end of the preceding quarter. The development was
attributed to the decrease in time and savings deposits with
the banks (Fig. 1, Table 1). Over the level at end-December
Growth in the key
monetary
aggregate
decelerated during
Q3 of 2015.


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2014, quasi money fell by 3.7 per cent, in contrast to the 2.2
and 25.3 per cent growth at the end of the preceding quarter
and the corresponding period of 2014, respectively.
Figure 1: Growth Rate of Narrow Money (M1) and Broad Money (M2)1

At N21,519.8 billion, aggregate domestic credit to the
economy, quarter-on-quarter, grew marginally by 0.5 per cent
at the end of the review quarter, compared with the growth
of 3.8 and 7.7 per cent at the end of the preceding quarter
and the corresponding period of 2014, respectively. The
development reflected the 10.9 per cent increase in net
claims on the Federal Government. Over the level at endDecember 2014, net domestic credit grew by 11.7 per cent,
compared with the 11.1 and 23.6 per cent increase at the end
of the preceding quarter and the corresponding period of
2014, respectively.
Banking system’s credit (net) to the Federal Government,
quarter-on-quarter, rose by 10.9 per cent to N2,787.6 billion,
compared with the growth of 26.5 per cent at the end of the
preceding quarter. The development reflected the rise in
DMB’s holding of government securities. Over the level at end-

1 QM1 and QM2 represent quarter-on-quarter changes, while CM1 and CM2 represent
cumulative changes (year-to-date).

-15
-10
-5

-10
-5

Q2-13
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Quarterly (%)
Cumulative (%)
QM1 (RHS)
QM2 (RHS)
CM1 (LHS)
CM2 (LHS)
Banking system credit
to the Federal
Government rose by
0.5 per cent at the
end of the third
quarter of 2015.


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December 2014, banking system credit (net) to the Federal
Government grew by 142.4 per cent, compared with the
growth of 118.5 per cent, at the end of the preceding quarter.
At N18,732.2 billion, banking system’s credit to the private
sector, quarter-on-quarter, fell by 0.9 per cent, in contrast to
the respective growth of 1.3 and 4.5 per cent at the end of
preceding quarter and the corresponding period of 2014,
respectively. The development relative to the level at the end
of the preceding quarter, reflected the 3.3 per cent increase
in claims on the core private sector. Over the level at endDecember 2014, banking system credit to the private sector
rose by 3.4 per cent, compared with 4.3 per cent growth at
the end of preceding quarter.
Figure 2: Growth Rate of Aggregate Domestic Credit to the Economy2

At N5,083.1 billion, foreign assets (net) of the banking system
fell by 14.6 per cent at the end of the third quarter 2015,
compared with the respective decline of 12.3 and 1.3 per
cent at the end of preceding quarter of 2015 and the
corresponding period of 2014. This was attributed to the fall in
banking system’s holdings of foreign assets. Over the level at
end-December 2014, foreign assets (net) declined by 26.9
per cent at the end of the third quarter, compared with the

2 QCP, QCG and QAC represent quarter-on-quarter changes in credit to private sector, credit to
government (net) and aggregate credit (net) to the domestic economy, respectively, while CCP,
CCG and CAC, represent the cumulative changes (year-to-date).
-50

-50

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Quarterly (%)
Cumulative (%)
QCP (RHS)
QCG (RHS)
QAC (RHS)
CCP (LHS)
CCG (LHS)
CAC (LHS)
Foreign assets (net)
of the banking
system fell at the end
of the review
quarter.


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Economic Report Third Quarter

respective decline of 14.4 and 12.5 per cent at the end of the
preceding quarter and the corresponding period of 2014.
Other Assets (net) of the banking system, quarter-on-quarter,
grew by 7.8 per cent to negative N7,884.9 billion, in contrast to
the decline of 3.1 and 8.1per cent at the end of preceding
period and the corresponding quarter of 2014, respectively.
Over the level at end-December 2014, other assets (net) of
the banking system fell by 7.8 per cent at the end of the
review quarter, compared with the decline of 16.9 per cent at
the end of the preceding quarter.
Table 1: Growth in Monetary and Credit Aggregates (Per cent) Over
Preceding Quarter
Dec-13
Mar-14
Jun-14
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Domestic Credit (Net)

Claims on Federal Government (Net)

Claims on Private Sector

Claims on Other Private Sector

Foreign Assets (Net)

Other Assets (Net)

Broad Money Supply (M2)

Quasi-Money

Narrow Money Supply (M1)

Memorandum Items:
Reserve Money (RM)


2.2
Currency-in-circulation (CIC) and Deposits at
the CBN
At N1, 637.5 billion, currency-in-circulation increased by 4.8 per
cent in the review quarter, in contrast to the decline of 14.1
per cent at the end of the second quarter of 2015. The
development was due largely, to monetary injections into the
economy as well as seasonal factors during the review
quarter.

Total deposits at the CBN amounted to N7,318.8, indicating a
rise of 5.9 per cent , compared with the level at the end of the
second quarter of 2015. The development reflected 14.2 and
138.6 per cent increase in Federal Government and private
sector deposits, respectively. Of the total deposits at CBN, the
shares of the Federal Government, Banks and ‘’Others’’ were
N2,623.7 billion (35.9 per cent), N4,150.8 billion (56.7 per cent)


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and N544.3 billion (7.4 per cent), respectively.
Reserve money (RM) fell by 2.6 per cent to N5,788.3 billion at
the the end of the third quarter, indicating the fall in DMB’s
reserves with the CBN.
2.3
Money Market Developments
The financial market was generally stable in the review period,
except for few days of volatility, due to the announcement of
JP Morgan to phase out Nigeria from its Government Bond
Index
for
Emerging
Markets
(GBI-EM)
and
the
full
implementation of the Treasury Single Account (TSA). To
mitigate the effect of these, palliatives were put in place by
the Bank and the Financial Market Dealers Quote (FMDQ) to
reduce the volatility experienced. For the TSA, the Bank
immediately refunded Cash Reserve Requirement (CRR) on
government revenue, while there remained unfettered access
to the discount window. In the case of the JP Morgan
announcement, the FMDQ at the height of the panic,
temporarily increased the spread in the two-way quote for
bonds from 30k to 100k to increase liquidity, while the Bank
sensitized the public to boost investors’ confidence. These
efforts achieved great result as yields adjusted to their preannouncement levels within a short period.
Provisional data indicated that the total value of money
market assets outstanding at the end of the third quarter of
2015 stood at N9,033.03 billion, showing an increase of 10.20
per cent, in contrast to the decline of 1.33 per cent at the end
of the preceding quarter. The development was attributed
largely, to the 17.89 per cent increase in the FGN Bonds.
2.3.1
Interest Rate Developments
Available data indicated that banks’ deposit and lending
rates trended upward during the third quarter of 2015. All the
deposit rates of various maturites rose from a range of 1.79 –
9.28 per cent to 1.97 – 11.28 per cent. At 9.24 per cent, the
average term deposit rate rose by 1.33 percentage points
above the level in the second quarter of 2015. The maximum
and prime lending rates rose by 0.45 and 0.78 percentage
point to 27.01 and 17.20 per cent, respectively. Consequently,
the spread between the weighted average term deposit and
maximum lending rates narrowed by 0.87 percentage points
The financial market
was generally stable
during the review
period.
Reserve money
(RM) fell at the end
of the third quarter
of 2015.
The spread between
the weighted –
average term deposit
and maximum lending
rates narrowed at the
end of the third
quarter.


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Economic Report Third Quarter

to 17.78 percentage points at the end of the third quarter of
2015. With headline inflation at 9.4 per cent at end-September
2015, most rates were positive in real terms, except the
average savings, 7-day and 1-month deposit rates.
At the inter-bank funds segment, the weighted average interbank call rate, which stood at 17.34 per cent at the end of the
preceding quarter, fell by 0.95 percentage point to 16.39 per
cent in the third quarter of 2015, reflecting the liquidity
condition in the banking system. The Nigeria inter-bank offered
rate (NIBOR) for the 30-day tenor rose from 15.45 per cent in
the preceding quarter to 15.38 per cent in the third quarter of
2015. However, the weighted average rate at the Open-BuyBack (OBB) segment fell by 0.22 percentage point to 15.40
per cent (Fig. 3, Table 2).
Figure 3: Selected DMBs Interest Rates (Average)


Table 2: Selected Interest Rates (Percent, Averages)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Average Term Deposits

Prime Lending

Interbank

Maximum Lending


Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Percent per Annum
Percent per Annum
Prime
Interbank
Maximum
Average Term Deposits (RHS)

Interbank call
rate rose in Q3
2015.


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2.3.2
Commercial Paper (CP)
Commercial Paper (CP) outstanding held by DMBs stood at
N4.9 billion at the end of the third quarter of 2015, compared
with N6.7 billion at the end of the preceding quarter. The
development was due to the fall in investment in CP by the
commercial
banks
during
the
quarter
under
review.
Consequently, CP constituted 0.05 per cent of the total value
of money market assets outstanding, at the end of the review
quarter, compared with 0.08 per cent at the end of the
preceding quarter.
2.3.3
Bankers’ Acceptances (BAs)
At the end of the review period, BAs outstanding stood at N6.7
billion, down from N8.6 billion at the end of the preceding
quarter. The development was attributed to the decrease in
investment in BAs by the DMBs during the quarter.
Consequently, BAs accounted for 0.07 per cent of the total
value of money market assets outstanding at the end of the
third quarter of 2015, compared with 0.10 per cent at the end
of the preceding quarter.
2.3.4 Open Market Operations
Direct OMO auctions were conducted twenty one times for
twelve tenors ranging from 311 – 346 days in the third quarter
of 2015. Total sales and subscription were N845.09 billion and
N1,592.91 billion, respectively. Bid rates range from 13.37
to19.00 per cent, while the stop rates ranged from 3.70 and
14.00 per cent. CBN bills valued at N1,180.40 billion matured
and were subsequently repaid, translating to a net injection of
N335.30 billion in the review quarter.
2.3.5
Primary Market
Nigerian Treasury Bills of 91-, 182- and 364-day tenors were
auctioned at the primary market during the review quarter.
Total amount offered, subscribed to and allotted stood at
N751.33
billion,
N1,293.86
billion
and
N751.33
billion,
respectively, compared with N994.67 billion, N2,360.99 billion
and N994.67 billion in the preceding quarter. The bid rates
ranged from 8.00 - 15.00, 10.00 – 18.00, and 12.00 – 18.00 per
cent, respectively, for the 19-, 182- and 364 day tenors, while
the stop rates ranged from 10.00 – 10.50, 12.63 – 13.50 and
13.00 – 14.71 per cent, respectively.
Investment in
CP by banks fell
in the third
quarter of 2015.
DMBs’ holdings of
BAs declined during
Q3 of 2015.


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2.3.6
Bonds Market
In the review quarter, FGN Bonds of 5- and 20-year tenor were
re-opened in two tranches. Total amount offered, subscribed
to and allotted were N205.0 billion, N394.24 billion and N159.0
billion, respectively. In addition, a total of N10.20 billion of the
5-year bond was allotted on non-competitive basis. The
marginal rates for all the tenors ranged from 15.19 –15.97 per
cent.
2.3.7
CBN Standing Facilities
Developments at the CBN standing facilities window in the
review quarter indicated higher patronage at the Standing
Deposit Facility (SDF) window than at the Standing Lending
Facility (SLF) window. Total request for SLF transactions in the
third quarter was N2,731.18 billion (inclusive of Intraday
lending facilities that was converted to overnight repo),
compared with N1,092.02 billion in the second quarter of 2015.
The total deposit at the SDF window stood at N4, 393.98 billion
compared with N4,637.11 billion in the preceding quarter. This
represented a daily average of N79.18 billion, while the
interest paid during the review period amounted to N2.02
billion.
2.4
Deposit Money Banks’ Activities
Available data indicated that the total assets and liabilities of
the commercial banks stood at N28,168.8 billion at the end of
the third quarter of 2015, representing a decline of 0.8 per
cent below the level at the end of the preceding quarter. The
funds were sourced, largely, from unclassified liabilities, drawdown on reserves and foreign assets disposal. The funds were
used, mainly, for trading in government securities.
At N17, 286.7 billion, banks’ credit to the domestic economy,
rose by 1.2 per cent, in contrast to the 1.1 per cent at the end
of the preceding quarter. The development was attributed to
the increase in claims on the Federal Government at the end
of the review quater.
Central Bank’s credit to the commercial banks rose by 4.7 per
cent to N317.80 billion at the end of the review quarter,
reflecting increase in CBN loans and advances to banks
above the level at the end of the preceding quarter. Total
At 39.8 per cent,
liquidity ratio in Q3
2015 was 9.8
percentage points
above the stipulated
minimum ratio, while
the Loan-to-deposit
ratio was below the
prescribed maximum of
80 per cent.
Subscription for FGN
Bonds of various
maturities were
reopened during the
third quarter of 2015.


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specified liquid assets of the banks stood at N6,844.7 billion,
representing 39.8 per cent of their total current liabilities. At
that level, the liquidity ratio rose by 4.0 percentage points
above the level at the end of the preceding quarter, and was
9.8 percentage points above the stipulated minimum ratio of
30.0 per cent. The loans-to-deposit ratio, at 70.2 per cent, was
2.4 percentage points above the level at the end of the
preceding quarter, but was 9.8 percentage points below the
prescribed maximum of 80.0 per cent.
2.5
Capital Market Developments
2.5.1
Secondary Market
Available data indicated that developments in the Nigerian
Stock Exchange (NSE) were bearish during the third quarter of
2015. This reflects the general downturn of activities in the
economy. Total volume and value of traded securities fell by
5.9 and 20.9 per cent to 23.26 billion shares and N219.76 billion,
respectively, in 229, 633 deals in the review period, compared
with 24.7 billion shares and N277.9 billion, respectively, in
273,502 deals in the second quarter of 2015. The Financial
Services Industry (measured by volume) led the activity chart
with 18.09 billion shares valued at N133.38 billion, traded in
130,087 deals; thus contributing 77.8 and 60.7 per cent to the
total
equity
turnover
volume
and
value
respectively,
compared 19.3 billion shares valued at N139.098 billion, traded
in 153,842 deals in the preceding quarter. The Banking
subsector of the Financial Services sector was the most active
during the review quarter.
Figure 4: Volume and Value of Traded Securities

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Value (N billion)
Volume (Billion)
Volume of traded securities (LHS)
Value of securities (RHS)


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Economic Report Third Quarter

Table 3: Traded Securities on the Nigerian Stock Exchange (NSE)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Volume (Billion)

Value (N Billion)


2.5.2
New Issues Market/Supplementary Listings
There were five (5) supplementary listings in the review quarter
(see table 4 below).
Table:4 New and Supplementary Listing on the Nigerian Stock Exchange
First Quarter 2015
1 Union Homes Savings & Loans
781.250 Million Ordinary Shares
Scheme of Arrangement
Supplementary
2 Ecobank Transnational Inc. Plc.
1.25 Million Ordinary Shares
Placement
Supplementary
3 United Bank for Africa Plc.
3.298 Million Ordinary Shares
Rights Issue
Supplementary
4 Academy Press
100800000 ordinary shares
Scrip Issue
Supplementary
5 Access Bank Plc
6,045,052,723 ordinary shares
Rights Issue
Supplementary

2.5.3
Market Capitalization
Aggregate market capitalization for all listed securities
(Equities and Bonds) stood at N17.01 trillion at the end of the
quarter under review, indicating a decrease of 0.1 per cent
below the level in the preceding quarter. Similarly, market
capitalization for the listed equities dropped by 0.6 per cent
below the level in the preceding quarter to close at N10.74
trillion. Listed equities accounted for 63.1 per cent of the
aggregate market capitalization, compared with 67.2 per
cent at the end of the preceding quarter.
2.5.4 NSE All-Share Index
The All-Share Index, which opened at 33,456.83 at the
beginning of the quarter, closed at 31, 217.77, representing a
decrease of 6.7 per cent below the level at the end of
preceding
quarter.
At
end-September
2015,
with
the
exception of the NSE Industrial index which closed flat at
2,228.96, all other sectoral indices fell below their respective
levels in the preceding quarter. The NSE Banking, NSE
Insurance, NSE Consumer goods, NSE Oil/Gas, NSE Lotus
Islamic and NSE ASeM indices declined by 13.8, 4.5, 4.5, 7.6,
6.0, and 0.4 per cent below their respective levels at the end
Total market
capitalization and
All-Share Index fell
during Q3 2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

of preceding quarter, to close at 319.14, 139.11, 807.30, 343.42,
2,095.90 and 1,208.40 at the end of the review period. The NSE
Pension index introduced during the review period closed at
946.31 at the end of the quarter.
Figure 5: Market Capitalization and All-Share Index

Table 5: Market Capitalization and All Share Index (NSE)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Market Capitalization (N trillion)

All-Share Index (Equities)
36,585.08

41,329.19

38,748.01

42,482.48

41,210.10

34,657.15

31,744.82

33,456.86

31,217.77


15.5

16.5

17.5

18.5

19.5
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Index
N billion
Market Capitalization (LHS)
All-Share Index (RHS)


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

3.0
Fiscal Operations
3.1
Federation Account Operations
At N1,913.15 billion, federally-collected revenue in the third
quarter of 2015, was lower than the 2015 quarterly budget
estimate of N2,444.60 by 21.7 per cent. However, this
exceeded the receipts in the preceding quarter by 36.9 per
cent. The decline in federally-collected revenue (gross)
relative to the quarterly budget estimate was attributed to the
shortfall in receipts from both oil and non-oil revenue during
the review quarter (Fig. 6, Table 6).
Figure 6: Components of Gross Federally Collected Revenue

Table 6: Gross Federation Account Revenue (N billion)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Federally-collected revenue (Gross)

Oil Revenue

Non-Oil Revenue


At N949.45 billion or 49.6 per cent of the total revenue, gross oil
receipt was lower than the provisional quarterly budget by
30.1 per cent. However, this exceeded the receipts in the
preceding quarter by 13.2 per cent. The decline in oil revenue
relative to the quarterly budget estimate was attributed to the
persistent short fall in receipts from crude oil/gas export, due to
the continous drop in the price of crude oil in the international
market (Fig. 7, Table 7).

Q2-13
Q3-13
Q4-13
Q1-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Oil Revenue Gross
Non-Oil Revenue
Gross federally -
collected revenue
rose by 36.9 per
cent above the
level
in
the
preceding quarter.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Figure 7: Gross Oil Revenue and Its Components

Table 7: Components of Gross Oil Revenue (N billion)


At N963.70 billion or 50.4 per cent of total revenue, gross nonoil receipts, also fell below the provisional budget estimate of
N1,086.79 billion by 11.3 per cent. The non-oil revenue was,
however, above the level in the preceding quarter by 72.6 per
cent. The fall in non-oil revenue relative to the provisional
budget estimate was due, largely, to the fall in receipts from
most of its components during the review quarter (Fig. 8, Table
8).
-


Q2-13
Q3-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
N billion
Others
PPT/Royalties
Domestic Crude oil/Gas Sales
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Oil Revenue

Crude oil/Gas Sales

PPT/Royalties

Others


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Figure 8: Gross Non-Oil Revenue and its Components
-

1,000
1,200
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
N billion

Table 8: Components of Gross Non-Oil Revenue (N billion)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Non-Oil Revenue

Value-Added Tax (VAT)

Companies Income Tax & Other Taxes

Customs & Excise Duties

Others/1

1/ Include FGN Independent Revenue, Education Tax, NITDF & Customs Federation/Non-Federation
Account Levies (Port, Sugar, ETLS, Steel, CISS & Cement Levies)
Of the gross federally-collected revenue, a net sum of
N1,209.51 billion was transferred to the Federation Account for
distribution among the three tiers of government and the
13.0% Derivation Fund. The sum of N30.59 billion, N194.03 billion
and N176.50 billion were transfred to the Federal Governmnet
Independenmt Revenue, VAT Pool Account and Others,
repectively. The Federal Government received N589.66 billion,
while the state and local governments received N299.08 billion
and N230.58 billion, respectively. The balance of N90.18 billion
was shared among the oil-producing states as 13.0%
Derivation Fund.
From the VAT Pool Account, the Federal Government
received N29.10 billion, while the state and local governments
received N97.01 billion and N67.91 billion, respectively.

The
sum
of
N1,209.51 billion
out of the gross
federally collected
revenue
was
shared among the
three
tiers
of
government
and
oil
producing
states as 13.0%
Derivation Fund.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Overaall, the total statutory and VAT revenue allocation to the
three tiers of government in the third quarter of 2015
amounted to N1,440.36 billion, compared with the provisional
quarterly budget estimate of N1,994.77 billion and N1,211.67
billion in the preceding quarter.
3.2
The Fiscal Operations of the Three Tiers of
Government

3.2.1
The Federal Government

Provisional data indicated that at N676.66 billion, the Federal
Government retained revenue for the third quarter of 2015
was below the budget estimate by 27.2 per cent. However,
this exceeded the receipts in the preceding quarter by 21.7
per cent. Of the total revenue, Federation Account
constituted 87.1 per cent, while Federal Government
Independent Revenue, VAT and Others accounted for 4.5, 4.3
and 4.1 per cent, respectively (Fig. 9, Table 9).
Figure 9: Federal Government Retained Revenue
Federation Account
(87.1 %)
VAT Pool
Account (4.3%)
Others(4.1%)
FGN Independent
Revenue (4.5%)


Table 9: Federal Government Fiscal Operations (N billion)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Retained Revenue

Expenditure

Overall Balance: Surplus(+)/Deficit(-)


At N676.66 billion, the
estimated
Federal
government
retained
revenue
was
lower
than
the

provisional
quarterly
budget
estimate
by
27.2, but exceeded the
receipts
in
the
preceding quarter by
21.7 per cent.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

At N963.13 billion, provisional data indicated that total Federal
Government expenditure for the third quarter of 2015 was
lower than both the provisional quarterly budget estimate and
the level in the preceding quarter by 19.0 and 7.6 per cent,
respectively. A breakdown of the total expenditure showed
that the recurrent expenditure accounted for 80.7 per cent,
while
capital
expenditure
and
transfers
components
accounted for the balance of 13.5 and 5.8 per cent,
repectively. Generally, non-debt obligations accounted for
63.9 per cent of the total recurrent expenditure, while debt
service payments accounted for the balance of 36.1 per cent
(Fig. 10).
Figure10: Federal Government Expenditure
Recurrent
Capital
Transfers
Capital
(13.5%)
Transfers
(5.8%)
Recurrent (80.7%)

Thus, the fiscal operations of the Federal Government resulted
in a deficit of N286.47 billion. However, it exceeded the 2015
provisional quarterly budget deficit of N260.25 billion by 10.1
per cent.
3.2.2
Statutory Allocations to State Governments

Statutory allocations to the state governments amounted to
N492.55 billion (including 13.0% Derivation Fund and VAT Pool
Account) in third quarter of 2015. This was 29.5 per cent below
the provisional budget estimate, but exceeded the level in the
preceding quarter by 13.7 per cent.
The breakdown showed that receipts from the Federation
Fiscal
operations
of the FG resulted
in an estimated
overall deficit of
N286.47 billion in
Q3 2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Account (including 13.0% Derivation) stood at N395.53 billion
or 80.3 per cent of the total, while receipts from the VAT Pool
Account was N97.01 billion or 19.7 per cent of the total.
3.2.3
Statutory Allocations to Local Government Councils

Total receipts by the local governments from the Federation
Account and VAT Pool Account stood at N301.74 billion at
end of the third quarter of 2015. This was lower than the
provisional budget estimate by 29.8 per cent, but exceeded
the level in the preceding quarter by 18.6 per cent. Of this
amount, receipts from the Federation Account was N233.83
billion (77.5 per cent of the total), while the VAT Pool Account
accounted for N67.91 billion (22.5 per cent).


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

4.0
Domestic Economic Conditions
The agricultural sub-sector witnessed increased level of activities as a
result of widespread rainfall in most parts of the country in the third
quarter of 2015. Major agricultural activities in the southern states
were harvesting of maize and yam, while the harvest of potatoes
and groundnuts dominated in the central and northern states.
Crude oil production was estimated at 1.95 million barrels per day
(mbd) or 179.40 million barrels for the quarter. The end-period
inflation rate for the third quarter of 2015, on year-on-year basis, was
9.4 per cent, compared with 9.2 and 8.3 per cent at the end of the
preceding quarter and the corresponding quarter of 2014,
respectively. The inflation rate on a 12-month moving average basis
was 8.7 per cent, compared with 8.4 per cent at the end of the
preceding quarter.
4.1
Agricultural Sector
Available data indicated increased tempo in agricultural
activities during the review quarter as a result of widespread
rainfall. Major agricultural activities in the southern states were
harvesting of maize and yam, while the harvest of potatoes
and groundnuts was dominant in the central and northern
states. In the livestock sub-sector, farmers re-stocked broilers
and layers to replenish sales made during Eid- El Fitr festival,
while export of cattle from the north to neighboring countries
was reported. The Nigerian Hydrological Services Agency 2015
Annual Flood Outlook indicated early warnings of iminent
flooding in Niger, Delta, Bayelsa, Rivers, Anambra, Taraba,
Nasarawa, Kebbi, Sokoto, Kogi and Benue States.
4.2
Agricultural
Credit
Guarantee
Scheme
Operations
A total of N2,905.3 million was guaranteed to 18,191 farmers
under the Agricultural Credit Guarantee Scheme (ACGS) in
the third quarter of 2015. The amount represented an increase
of 8.4 per cent above the level in the preceding quarter, but a
decline of 14.8 per cent relative to the level in the
corresponding period of 2014. Sub-sectoral analysis showed
that food crops accounted for the largest share of N2,085.6
million (71.8 per cent) guaranteed to 13,594 beneficiaries;
while livestock got N271.0 million (9.3 per cent) guaranteed to
999 beneficiaries. The sum of N217.6 million (7.5 per cent)was
guaranteed to 1,370 beneficiaries in the mixed crops sub-


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

sector, while N140.8 million (4.8 per cent) was guaranteed to
486 beneficiaries in the fisheries sub-sector. ‘Others’received
N135.8 million (4.7 per cent) guaranteed to 1,251 beneficiaries
while, cash crops received N54.3 million (1.9 per cent)
guaranteed to 491 beneficiaries,.
Thirty five (35) States of the federation including the Federal
Capital Territory benefited from the Scheme in the third
quarter of 2015. The highest and lowest sums of N628.6 million
(21.6 per cent) and N4.8 million (0.2 per cent) were
guaranteed to Benue and Bayelsa states, respectively.
At end-September 2015, the total amount released by the
CBN under the Commercial Agriculture Credit Scheme
(CACS) to the participating banks for disbursement remained
at N310.9 billion for 396 projects, the same level as the
previous quarter (Table 10).


4.3
Industrial Production
Industrial activities indicated a marginal increase during the
third quarter of 2015, compared with the level in the
preceding quarter. At 112.5 (2010=100), the estimated index of
industrial production rose by 0.01 per cent above the level in
the preceding quarter, but was 0.06 per cent below the level
Industrial activities
rose in the review
quarter due to
increased activities
in all sub-sectors.
Table 10: Disbursement of Credit Under the Commercial Agriculture Credit Scheme (CACS)
S/N
Participating Banks
Amt Disbursed (N billion)
Number of Projects/State Governments

United Bank for Africa (UBA) Plc
45.8

Zenith Bank
52.3

First Bank of Nigeria Plc
36.5

Unity Bank Plc
24.2

Union Bank Nigeria PLC
20.1

Stanbic IBTC Bank
17.3

Sterling Bank Plc
15.6

Access Bank Plc
13.6

Fidelity Bank Plc
10.9

Skye Bank Plc
9.7

GTBank Plc
11.4

FCMB Plc.
7.3

ECOBANK
6.4

Heritage Bank Plc
3.2

Diamond Baqnk Plc
4.4

Citibank Plc
3.0

Keystone Bank
2.2

Mainstreet Bank
2.0

Wema Bank
1.1

Enterprise Bank
0.5

TOTAL
310.9

C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

in the corresponding quarter of 2014. The development
relative to preceding quarter was attributed to the marginal
improvement in activities in all sub-sectors.
The estimated index of manufacturing production in the third
quarter of 2015, at 181.2 (2010=100), showed a marginal
increase of 0.01 per cent, compared with the level in the
preceding quarter. It was, however, 0.06 per cent below the
level in the corresponding period of 2014. Capacity
utilization, at 54.9 per cent, rose by 0.8 percentage point
above the level in the preceding quarter. The development
was attributed to the improvement in power supply during
the review period (Fig.11).
Figure11: Manufacturing Capacity Utilization Rate

At 83.1 (2010=100), the estimated index of mining production
rose marginally by 0.01 per cent relative to the level in the
preceding quarter, but was 0.05 per cent below the level in
the corresponding period of 2014. The rise in mining
production during the review quarter, was due to the increase
in crude oil and gas production.
At 4,600 MW/h, estimated average electricity generation in
the third quarter indicated an increase of 64.3 per cent
compared with the level in the preceding quarter. The
development was attributed to the improved gas supply and
high water levels at power plants across the country.

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Percent
Actual industrial
capacity utilization
rose by 0.8
percentage point
during the review
quarter.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

At 4,456 MW/h, estimated average electricity consumption
rose by 72.0 per cent above the level in the preceding
quarter. The rise in electricity consumption was attributed to
the improved power supply (Fig. 12, Table 11).
Figure 112: Index of Industrial Production (2010=100) 3

Table 11: Index of Industrial Production and Manufacturing Capacity Utilization Rate
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
All Sectors (1990=100)

Manufacturing

Mining


Capacity Utilization (%)

Petroleum Sector
Nigeria’s crude oil production, including condensates
and natural gas liquids, was estimated at an average of
1.95 million barrels per day (mbd) or 179.40 million barrels
(mb) for the third quarter. This represented an increase of
0.04 mbd or 2.3 per cent, relative to 1.91 mbd or 173.81
million barrels produced in the second quarter of 2015.
Crude oil export was estimated at 1.50 mbd or 138.00
million barrels. This represented an increase of 3.0 per
cent, compared with 1.46 mbd or 132.86 mb recorded in

3 Index measurement at (2010=100) from first quarter15

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Index
Mining
All Sectors
Manufacturing
Average electricity
generation and
consumption rose
during the review
quarter.
Crude oil and natural
gas production
increased in the third
quarter of 2015.
Crude oil export
increased in Q3 2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

the
preceding
quarter.
The
development
was
attributable
to
improved
surveillance
by
security
agencies which had reduced the incessant oil theft,
illegal bunkering and production shut-ins experienced in
recent years. Deliveries to the refineries for domestic
consumption remained at 0.45 mbd or 41.4 million barrels
during the review quarter.
At an estimated average of US$51.15 per barrel, the price of
Nigeria’s reference crude, the Bonny Light (37o API), fell by
17.8 per cent below the level in the preceding quarter. The
average prices of other competing crudes, namely the U.K
Brent, the West Texas Intermediate and the Forcados at
US$50.08, US$47.00 and US$51.27 per barrel, also fell below
their levels in the preceding quarter.
The average price of OPEC’s basket of eleven crude streams
at US$48.14 per barrel, indicated a fall of 18.8 and 52.3 per
cent below the levels in the preceding quarter and the
corresponding period of 2014, respectively (Fig. 13, Table 12).
Figure12: Trends in Crude Oil Prices

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
US$ per barrel
Bonny Light
OPEC Basket
Average crude
oil prices,
including
Nigeria’s Bony
Light (37o API)
fell in the
international
crude oil
market in Q3
2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Table 12: Average Crude Oil Prices in the International Oil Market
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Bonny Light

OPEC Basket


4.5
Consumer Prices4
Available
data
showed
that
the
all-items
composite
Consumer Price Index (CPI) at the end of the third quarter of
2015 was 176.5 (November 2009=100), representing an
increase of 1.9 and 9.4 per cent above the levels in the
preceding quarter and the corresponding quarter of 2014,
respectively. The development was driven, largely, by the
contributions of food and non-alcoholic beverages; housing,
water, electricity, gas and other fuel; clothing and footwear;
transport; furnishing, household equipment and maintenance;
health; and education.
The urban all-items CPI at the end of the third quarter of 2015
was 175.5 (November 2009=100), indicating an increase of 0.7
and 9.5 per cent over the levels in the preceding quarter and
the corresponding period of 2014, respectively. Similarly, the
rural all-items CPI, at 177.5 (November 2009=100), represented
an increase of 0.5 and 9.3 per cent over the levels in the
preceding quarter and the corresponding period of 2014,
respectively (Fig. 14, Table 13).
The composite food index (with a weight of 50.7 per cent) was
181.8 per cent, representing an increase of 2.1 per cent,
compared with the 178.1 per cent at the end of the
preceding quarter. The development was attributed to the
increase in the prices of yam, potatoes, vegetables, rice, fruits,
maize and processed food.


4 New CPI with November 2009 = 100 as base and new weight based on the 2003/2004 Nigeria
Living Standard Survey (NLSS) was released by the National Bureau of Statistics (NBS) ON 18TH
October 2010.
The general price
level rose in Q3,
compared with the
preceding quarter of
2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Figure13: Consumer Price Index

Table 13: Consumer Price Index (November 2009=100)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Composite

Urban

Rural


The inflation rate at the end of the review quarter, on a yearon-year basis, was 9.4 per cent, compared with 9.2 and 8.3
per cent in the preceding quarter and corresponding period
of 2014, respectively. On a twelve-month moving average
basis, the inflation rate was 8.7 per cent, indicating a 0.3
percentage point increase over the level recorded in the
preceding quarter (Fig. 15, Table 14).

142.5

147.5

152.5

157.5

162.5

167.5

172.5

177.5

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Index
Composite
Urban
Rural
The headline
inflation (y-o-y)
stood at 9.4 per
cent in Q3 2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Figure 15: Inflation Rate


Table 14: Headline Inflation Rate (%)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
12-Month Moving Average

Year-on-Year


Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Percent
12-Month Average
Year-on-Year


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

5.0
External Sector Developments
Provisional data indicated that foreign exchange inflow and outflow
through the CBN in the third quarter of 2015 rose by 59.2 and 16.2
per cent, above the levels in the preceding quarter, respectively.
Total non-oil export receipts rose by 90.4 per cent above the level in
the preceding quarter, but fell by 71.9 per cent below the level in
the corresponding quarter of 2014. At the inter-bank segment of the
foreign exchange market, the average naira exchange rate,
depreciated by 0.01 per cent to N196.99 per dollar relative to the
preceding quarter. Similarly, at the BDC segment, the average naira
exchange rate, depreciated by 3.9 per cent, to N225.21 per United
States dollar, relative to the level in the preceding quarter. The gross
external reserves rose by 5.3 per cent in the third quarter to US$29.85
billion, above its level at the end of the preceding quarter.
5.1
Foreign Exchange Flows
Provisional data indicated that foreign exchange inflow and
ouflow through the CBN in the third quarter of 2015 were
US$11.11billion and US$9.52 billion, respectively. This resulted in
a net inflow of US$1.59 billion, in contrast to the net outflow of
US$1.22 billion in the preceding quarter. Relative to the level at
the end of the preceding quarter, inflow rose by 59.2 per cent,
but was lower than the level in the corresponding period of
2014 by 14.7 per cent. The development was due to the
significant rise in crude oil receipts. Similarly, outflow rose by
16.2 per cent, above the level in the preceding quarter, but
was lower than the level in the corresponding period of 2014
by 19.3 per cent. The development relative to the preceding
quarter was, due largely, to the increased funding of the
foreign exchange market, external debt service and other
official payments (Fig.16, Table 15).


Foreign exchange
inflow and outflow
through the CBN rose
by 59.2 and 16.2 per
cent, resulting in a
net inflow of US$1.59
billion in Q3 of 2015.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Figure 16: Foreign Exchange Flows Through the CBN


Table 15: Foreign Exchange Flows Through the CBN (US$ million)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Inflow
11,857.35

9,465.52

10,221.43

12,676.51

13,094.23

10,641.86

8,307.23

6,976.02

11,111.00

Outflow
12,667.33

10,789.61

15,695.66

12,806.25

11,804.98

14,527.35

12,875.77

8,194.56

9,523.32

Netflow
(809.98)

(1,324.09)

(5,474.23)

(129.74)

1,289.25

(3,885.49)

(4,568.54)

(1,218.54)

1,587.68


Provisonal data on aggregate foreign exchange inflows
through the economy indicated that total inflow was US$27.34
billion. This represented an increase of 15.3 per cent above
the level in the preceding quarter, but a decline of 38.1 per
cent below the level in the corresponding period of 2014. The
development was driven by the rise in receipts from both the
crude oil and non-oil components. Oil sector receipts, which
accounted for 24.5 per cent of the total, stood at US$6.69
billion, compared with US$3.83 billion and US$9.95 billion,
recorded in the preceding quarter and the corresponding
period of 2014, respectively.
Non-oil public sector inflow, at US$4.42 billion (16.2 per cent of
the total), rose by 40.8 and 43.0 per cent above the levels in
the preceding quarter and the corresponding period of 2014,
respectively. Autonomous inflow, which accounted for 59.3
per cent of the total, fell by 3.0 per cent, compared with the
level in the preceding quarter.
Autonomous inflow
into the economy fell
by 3.0 per cent in Q3
2015 .
-10,000
-5,000


Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
US$ million
Inflow
Outflow
Netflow


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Economic Report Third Quarter

At US$10.94 billion, aggregate foreign exchange outflow from
the economy increased by 27.0 per cent above the level in
the preceding quarter, but indicated a decline of 11.2 per
cent when compared with the level in the corresponding
period of 2014. The development relative to the preceding
quarter, was accounted for, mainly, by the increase in foreign
exchange market utilisation. Thus, foreign exchange flows
through the economy resulted in a net inflow of US$16.40
billion in the review quarter, compared with US$15.09 billion
and US$31.87 billion in the preceding quarter and the
corresponding period of 2014, respectively.
5.2
Non-Oil Export Earnings by Exporters
Provisional data indicated that total non-oil export earnings at
US$1.20 billion, increased by 90.4 per cent above the level in
the preceding quarter, but was a decline of 71.9 per cent
when compared with the level in the corresponding period of
2014. The development, relative to the preceding quarter, was
attributed, mainly, to the significant rise in receipts from
manufactured products and industrial sector. A breakdown by
sectors showed that proceeds from manufactured products,
agricultural products, minerals, industrial sector and food
products sub-sectors stood at US$572.15 million, US$205.81
million, US$188.28 million, US$172.90 million and US$63.23
million, respectively.
The shares of manufactured products, agricultural products,
minerals, industrial sector and food products in non-oil export
proceeds were 47.6, 17.1, 15.7, 14.4 and 5.3 per cent,
respectively.
5.3
Sectoral Utilisation of Foreign Exchange

The invisible sector accounted for the bulk (54.5 per cent) of
total foreign exchange disbursed in the third quarter of 2015,
followed by the industrial sector (15.6 per cent). The
contributions of other sectors in a descending order included:
minerals and oil sector (11.4 per cent), manufactured
products (9.9 per cent), food products (6.2 per cent), transport
sector (1.9 per cent) and agricultural products (0.5 per cent)
(Fig.17).
.
The invisible sector
accounted for the
bulk of the total
foreign exchange
disbursed during
Q3 2015.
Total non-oil
export earnings
by exporters
rose during the
third quarter of
2015.


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Economic Report Third Quarter

Figure17: Sectoral Utilisation of Foreign Exchange

5.4
Foreign Exchange Market Developments5
Provisional data indicated that aggregate demand for foreign
exchange at the inter-bank and BDC segments fell by 15.0 per
cent to US$61.39 billion below the level in the preceding
quarter of 2015. However, it indicated an increase of 454.3 per
cent relative to the level in the corresponding period of 2014.
A total of US$8.04 billion was sold by the CBN to authorized
dealers during the third quarter of 2015. This reflected an
increase of 9.4 per cent above the level in the preceding
quarter, but showed a decline of 20.8 per cent below the
level in the corresponding period of 2014. The development,
relative to the preceding quarter was attributed, largely, to
the increase in sales to inter-bank. Of the aggregate sales,
inter-bank and BDC sales were US$4.85 billion and US$1.24
billion, respectively. Also, forward contracts valued at US$0.45
billion were disbursed at maturity and swap transactions of
US$1.50 billion was conducted in the review quarter (Fig. 18,
Table 16).


5 Market Closed (MC) - wDAS and rDAS window was closed in February 2015


Percent of Total
Q1-15
Q2-15
Q3-15
Demand for foreign
exchange by
authorized dealers
fell, while supply of
the foreign exchange
by authorized dealers
rose during Q3 2015.


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Economic Report Third Quarter

Figure 18: Demand for and Supply of Foreign Exchange


Table 16: Demand for and Supply of Foreign Exchange (US$ billion)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Forex Sales at rDAS

MC
MC
Forex Demand at rDAS

MC
MC
Supply of Forex to BDC

Total Forex Supply(BDC and rDAS)


The average exchange rate at the inter-bank segment, at
N196.99/US$, showed a marginal depreciation of 0.01 and
17.6 per cent, relative to the rates in the preceding quarter
and the corresponding quarter of 2014, respectively. At the
BDC segment, the average exchange rate, at N225.21 per US
dollar, depreciated by 3.9 and 25.0 per cent relative to their
respective
levels
in
the
preceding
quarter
and
the
corresponding period of 2014, respectively (Fig. 19, Table 17).
Consequently, the premium between the inter-bank and BDC
rates widened to 14.3 per cent from 9.9 per cent in the
preceding quarter. This, however, exceeded the international
benchmark of 5.0 per cent (Fig. 20, Table 17).

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
US$ billion
Forex Sales at rDAS
Forex Demand at rDAS
Supply of Forex to BDC
Total Forex Supply
The average naira
exchange rate visà-vis the US dollar
depreciated in all
segments of the
foreign exchange
market in Q3
2015.
The premium
between the interbank and the BDC
rates widened in
the review period.


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Economic Report Third Quarter

Figure 19: Average Exchange Rate Movements

Table 17: Exchange Rate Movements and Exchange Rate Premium
Average Exchange Rate (N/US$)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
rDAS

169.68 N/A
N/A
BDC

Interbank

Premium (%)
rDAS/BDC

23.5 N/A
N/A
rDAS/Interbank

12.6 N/A
N/A
BDC/Interbank


Figure 20: Exchange Rate Premium

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
N/US $
Average wDAS/rDAS
Average BDC
Average Interbank

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Per cent
rDAS/BDC
rDAS/Interbank
Interbank/BDC


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Economic Report Third Quarter

5.5
Gross Official External Reserves
Gross external reserves at the end of the third quarter of 2015
stood at US$29.85 billion, indicating an increase of 5.3 per
cent above the level in the preceding quarter, but a decline
of 22.0 per cent below the level in the corresponding period of
2014. The development, relative to preceding quarter, was
attributed to the receipts of monetized funds from domiciliary
accounts and improved NNPC/LNG receipts especially in July
2015. A breakdown of the official external reserves showed
that CBN reserves stood at US$23.46 billion (78.6 per cent),
Federation reserves, US$2.48 billion (8.2 per cent) and the
Federal Government reserves, US$3.94 billion (13.2 per cent)
(Fig. 21, Table 18).
Figure 21: Gross Official External Reserves


Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
US$ million

Table 18: Gross Official External Reserves (US$ million)
Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
External Reserves
44,108.5

42,847.3

37,376.4

37,330.0

38,278.6

34,241.5

29,357.2

28,335.2

29,850.1


Gross external
reserves rose
during the third
quarter 2015.


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Economic Report Third Quarter

C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

6.0 Global Economic Conditions
6.1 Global Output
The global economy continued to be affected by the decline
in oil prces, appreciation of the dollar, slowdown in China,
uncertainty in Europe and anticipation of a shift in US
monetary policy. The International Monetary Fund (IMF) World
Economic Outlook (WEO), July 2015, projected global growth
at 3.3 per cent in 2015, with a gradual pick-up in advanced
economies
and
slowdown
in
emerging
market
and
developing economies. Growth is expected to strengthen to
3.8 per cent in 2016.
Growth in advanced economies is projected to increase from
1.8 per cent in 2014 to 2.1 per cent, in 2015. The underlying
drivers remain acceleration in consumption and investment in
the United States, wage growth, labor market conditions,
lower fuel prices and a strengthened housing market. Japan is
recovering, while European economy is finally accelerating
but still faces continuing uncertainty about financial stability.
Emerging market and developing economies are projected to
slow from 4.6 per cent in 2014 to 4.2 per cent in 2015. The
slowdown reflects the dampening impact of lower commodity
prices, tighter external financial conditions, rebalancing in
China, structural bottlenecks and economic distress related to
geopolitical factors in the Commonwealth of Independent
States, and the Middle East and North Africa.
Sub-Saharan Africa is projected to slow from 5.0 per cent in
2014 to 4.4 per cent in 2015. Oil exporters in the region will be
severely affected, with growth in 2015 marked down by
almost two and half percentage points. By contrast, growth in
the region’s oil importers in 2015 –16 is expected to average
4.8 per cent, as the favorable impact of lower oil prices will be
offset to a large extent by lower commodity export prices.
6.2 Global Inflation
Global inflation remained low in the third quarter of 2015
following the sharp decline in oil price. Annual inflation in the
OECD countries remained stable at 1.6 per cent. Headline
inflation remained broadly unchanged at low levels in major
advanced economies, while disinflationary pressures persist in


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

China and India. However, in Brazil and Russia, inflation
remained high, as currency depreciation led to higher import
prices. Inflation in the United States was 0.0 per cent in
September 2015, due to the low gasoline prices and a strong
dollar. Eurozone fell into deflation as prices were pushed down
by low energy cost.
On average, inflation in the emerging markets was low, but
with significant divergences among different economies.
Many of the economies struggling with high inflation are also
those that had their currencies depreciated sharply recently.
In Sub-Saharan African countries, inflation is expected to
remain contained due to low global food and fuel prices.
However, inflation is expected to rise for oil exporting countries
like Nigeria and Angola as the impact of the exchange rate
depreciation and cuts in fuel subsidies in the case of Angola
impacts on the general price level.
6.3 Global Commodity Demand and Prices
World crude oil demand was estimated at 93.47 mbd in the
third quarter of 2015, representing an increase of 1.6 per cent
above the 92.03 mbd recorded in the preceding quarter.
World crude oil supply was estimated at 94.56 mbd,
representing marginal decline of 0.2 per cent compared with
the level in the preceding quarter. Increase in demand was
attributed to the high gasoline demand in the US and China
due to increased car sales, supported by lower oil prices.
The price of OPEC Reference Basket (ORB) averaged US$48.14
per barrel in the third quarter of 2015, representing a decrease
of 18.8 per cent below the level in the second quarter of 2015.
The development was attributed to persistence in factors that
have negatively affected global oil prices, though there have
been signs of alleviation, as demand picked-up and stocks
were drawn in some regions, recently.
6.4
International Financial Markets
The international stock markets largely exhibited bearish trend
during the third quarter of 2015. In Europe, market indices
declined across the region during the period. In North
America, the S&P 500, S&P/ TSX Composite and Mexico Bolsa
indices all decreased by 6.94, 8.56 and 5.37 per cent


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Economic Report Third Quarter

respectively. Similar trend was observed in South America and
Asia. Chinese stock market experienced a “black Monday”
which affected markets all over the globe, dampening any
prospect of US raising interest rates during the quarter.
In Africa, the Kenyan Nairobi NSE 20 and Egyptian EGX CSE 30
indices declined by 14.93 and 12.53 per cent respectively.
Similarly, the Nigerian All-Share Index, South African JSE and
Ghanaian GSE All-Share indices also decreased by 6.69, 3.32
and 14.57 per cent, respectively, in the review period.
6.5 Other International Economic Developments
and Meetings
Other major international economic developments and
meetings of importance to the domestic economy during the
review period included the United Nations third International
Conference on Financing for Sustainable Development, which
held in Addis Ababa, Ethiopia, from July 13 – 16, 2015. At the
end of the conference, the Addis Ababa Action Agenda of
more than 100 measures was adopted. The measures, will
enable and direct financial investments by public and private
sectors
towards
meeting
the
challenges
of
financing
sustainable development.
The United Nations General Asembly was held in New York,
United States, from September 25 to 27, 2015. The Assembly
endorsed a new set of Sustainbale Development Goals to end
poverty, promote prosperity and protect the environment.
Also, the board of directors of the African Developmnet Bank
held its board meeting at the Bank’s headquarters in Abidjan,
Ivory Coast on July 8, 2015. Major decisions at the end of the
meeting included, among others:

Proposal to update the Decentralisation Action Plan 2015
- 2017;

Proposal for Field Office Locally Recruited SStaff (LRS)
Salary Adjustments;

Africinvest Fund III;

Morocco
Economic
Competitiveness
Support
Programme (PACEM); and

Bissau City Electricity Supply Improvement Project.


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Also, the African Caucus meeting of the International
Monetary Fund (IMF) and World Bank Group (WBG) was held
in Luanda, Angola, from August 27 - 29, 2015. The theme of the
high level dialogue was “Promoting Economic Tranformation
for a Sustainable Development in Africa”. Major issues
discussed during the high level panel dialogue included:

Regional Economic Outlook;

Economic Transformation and Diversification;

Stemming Illicit Financial Flows for Improved Domestic
Resource Mobilizations;

IDA Future Financing Options; and

Public
Private
partnerships:
Solution
for
Africa’s
Infrastructural Challenges;
Finally, a High Level Stakeholder Consultative Meeting of
African business and political leaders held at the AfDB
headquarters in Abidjan, Ivory Coast on September 17, 2015.
At the end of the meeting, the (AfDB) unveiled its landmark
iniiative to solve Africa’s huge energy deficit by 2025. The subSaharan Africa’s energy financing gap was put at about
US$55 billion. The “New Deal for Energy in Africa,” focuses on
mobilizing support and funding for the initiative from five key
areas, including:
i.
Expansion of AfDB support towards energy in Africa;
ii. Countries would have to expand their share of financing
going into the energy sector;
iii. Countries would also need to demonstrate stronger
political will to ensure success of the Deal;
iv. Development partners would be obliged to scale up ongoing efforts; and
v. Development partners would also be required to work
together and coordinate their efforts to drive critical
policy and regulatory reforms of the energy sector to
improve incentives for accelerated investments.


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APPENDIX TABLES


C e n t r a l B a n k o f N i g e r i a

Economic Report Third Quarter

Table A1: Money and Credit Aggregates


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Economic Report Third Quarter

1/ Quasi money consist of Time, Savings and Foreign Currency Deposit at Deposit Money Banks excluding Taking from Discount
Houses.

2/ Demand Deposit consist of State, Local and Parastatals Deposits at CBN, State, Local Government and Private Sector Deposits as well
as Demand Deposits of non-financial Public Enterprises at Deposit Money Banks.


Table A2: Money and Credit Aggregates (Growth Rates)
Jun-14
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Domestic Credit (Net)

Claims on Federal Government (Net)

Central Bank (Net)

Banks

Claims on Private Sector

Central Bank

Banks

Claims on Other Private Sector

Central Bank

Banks

Claims on State and Local Government

Central Bank

DMBs

Claims on Non-financial Public Enterprises

Central Bank

DMBs

Foreign Assets (Net)

Central Bank

DMBs and Non Interest Banks

Other Assets (Net)

Total Monetary Assets (M2)

Quasi-Money 1/

Money Supply (M1)

Currency Outside Banks

Demand Deposits 2/

Total Monetary Liabilities (M2)

Memorandum Items:
Reserve Money (RM)

Currency in Circulation (CIC)

Banks' Deposit with CBN

N billion


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Economic Report Third Quarter

Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Domestic Credit (Net)

Claims on Federal Government (Net)

Claims on Private Sector

Claims on Other Private Sector

Claims on State and Local Government

Claims on Non-financial Public Enterprises
Foreign Assets (Net)

Other Assets (Net)

Total Monetary Assets (M2)

Quasi-Money 1/

Money Supply (M1)

Currency Outside Banks

Demand Deposits 2/

Total Monetary Liabilities (M2)

Memorandum Items:
Reserve Money (RM)

Currency in Circulation (CIC)

DMBs Demand Deposit with CBN

Domestic Credit (Net)

Claims on Federal Government (Net)

Claims on Private Sector

Claims on Other Private Sector
3.18
10.02

2.6
4.6
3.31
Claims on State and Local Governments

Claims on Non-financial Public Enterprises
Foreign Asset (Net)

Other Asset (Net)


Total Monetary Assets (M2)

Quasi-Money 1/

Money Supply (M1)

Currency Outside Banks

Demand Deposits 2/

Total Monetary Liabilities (M2)

Memorandum Items:
Reserve Money (RM)

Currency in Circulation (CIC)

DMBs Demand Deposit with CBN

Percentage Change Over Preceding Quarter
Percentage Change Over Preceding December

1/ Quasi money consist of Time, Savings and Foreign Currency Deposit at Deposit Money Banks excluding Taking from Discount Houses.
2/ Demand Deposit consist of State, Local and Parastatals Deposits at CBN, State, Local Government and Private Sector Deposits as well as Demand Deposits of
non-financial Public Enterprises at Deposit Money Banks.


Table A3: Federal Government Fiscal Operations (N billion)


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Economic Report Third Quarter

Q3-13
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Retained Revenue

Federation Account

VAT Pool Account

FGN Independent Revenue

Excess Crude

Others/SURE-P

Expenditure

Recurrent

Capital

Transfers

Overall Balance: Surplus(+)/Deficit(-)


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Economic Report Third Quarter