ECONOMIC REPORT
FIRST QUARTER 2016


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 First 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
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Economic Report First Quarter

Contents


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Text Tables
Appendix Tables


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Figures


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1.0 Summary
On quarter-on-quarter basis, growth in the key monetary aggregate
accelerated in the first quarter of 2016. Over the level at the end of
the fourth quarter of 2015, broad money supply, (M2), grew by 2.2
per cent at the end of the first quarter of 2016. The development
reflected the rise of 4.9 and 7.1 per cent in net domestic credit and
other assets (net) of the banking system, respectively, which
dampened the fall of 1.8 per cent in foreign assets (net) of the
banking system.
Banks’ deposit and lending rates trended downwards during the first
quarter of 2016. The spread between the weighted average term
deposit and maximum lending rates widened to 21.42 percentage
points at the end of the first quarter of 2016. Similarly, the margin
between the average savings deposit and the maximum lending
rates widened to 23.77 per cent. At the inter-bank funds segment,
the weighted average inter-bank call rate rose to 3.01 per cent in
the first quarter of 2016, reflecting the liquidity condition in the
banking system.
The total value of money market assets outstanding at the end of
the first quarter of 2016 stood at N9,751.83 billion, showing an
increase of 13.1 per cent above the level in the fourth quarter of
2015. The development was attributed, largely, to the 19.0 and 1.87
per cent growth in FGN Bonds and treasury bills outstanding,
respectively. On the Nigerian Stock Exchange (NSE), activities were
mixed as some market indicators trended upward, while others
trended downward.
At N1,268.59 billion or 52.5 per cent, total federally-collected
revenue was 48.1 and 18.0 per cent lower than the quarterly budget
estimate and the preceding quarter’s receipts, respectively. Gross oil
receipt which stood at N666.13 billion was lower than both the
provisional quarterly budget and the receipts in the preceding
quarter. The development was attributed to the persistent fall in
receipts from crude oil/gas export arising from the continuous drop
in the price of crude oil as well as a series of shut-ins and shut-downs
at some NNPC terminals owing to pipeline vandalism.
Non-oil receipts, at N602.46 billion or 47.5 per cent of the total, fell
below the level in the fourth quarter of 2015 by 16.0 per cent.
Federal Government retained revenue was N505.07 billion, while
total expenditure was N1,230.25 billion, resulting in an estimated
deficit of N725.18 billion in the first quarter of 2016, compared with
the 2015 quarterly budget deficit of N260.25 billion.


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Activities in the agrcultural sector remained moderate, as farmers
engaged in preparations for early planting and off season
cultivation. Farmers in the South engaged in harvesting of tree crops
and clearing of land for 2016 wet season farming, while tending of
irrigation-fed vegetable and cereal crops were undertaken in the
Northern states. In the livestock sub-sector, there were market
disruptions in some major cattle markets in the Northern states,
especially Borno, leading to temporary closures due to increased
rustling by the insurgents. The end-period headline inflation rate on
year-on-year basis, was 12.8 per cent, while the inflation rate on a
12-month moving average basis was 9.8 per cent.
World crude oil demand and supply were estimated at 93.15 mbd
and 95.70 mbd, respectively, in the first quarter of 2016. Nigeria’s
crude oil production, including condensates and natural gas liquids,
was estimated at an average of 1.82 million barrels per day (mbd) or
165.62 million barrels (mb) for the first quarter of 2016. Crude oil
export was estimated at 1.37 mbd or 124.67 million barrels, while
deliveries to the refineries for domestic consumption remained at
0.45 mbd or 40.95 million barrels during the review quarter. The
average price of Nigeria’s reference crude, the Bonny Light (370
API), fell by 22.0 per cent, compared with level in the fourth quarter
of 2015.
Provisional data showed that foreign exchange inflow and outflow
through the CBN amounted to US$3.98 billion and US$5.85 billion,
respectively, resulting in a net outflow of US$1.87 billion. Foreign
exchange sales by the CBN to the authorized dealers amounted to
US$4.67 billion. The average exchange rate of the naira vis-à-vis the
US dollar at the inter-bank depreciated by 0.01 per cent from the
level in the fourth quarter of 2015 to close at N197.00.
The global economic growth remained modest and uneven as it
continued to be affected by the decline in oil prices and
uncertainties in the Chinese economy. Overall, global economic
develpment was shaped by relatively strong growth in India and the
US as well as disappointing, but improving growth in Europe and
Japan.
Other major international economic developments and meetings of
importance to the domestic economy during the review period
included: The Official visit by the Managing Director (MD) of the
International Monetary Fund (IMF) and her team to Abuja, Nigeria
from January 4 – 7, 2016; the 2015 End-of-Year Statutory Meetings of
the West African Monetary Zone (WAMZ), West African Monetary
Agency (WAMA) and the West African Institute for Financial and
Economic Management (WAIFEM) held at the Kempinski Hotel, Gold


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Economic Report First Quarter

Coast City, Accra, Ghana from January 8 – 15, 2016; the 32nd
Meeting of the Committee of Governors of Central Banks of the
West African Monetary Zone (WAMZ) held on January 14, 2016 at the
Kempinski Hotel, Gold Coast, Accra, Ghana. Others were the 47th
meeting of the Committee of Governors of ECOWAS member
Central Banks held on January 14, 2016 at the Kempinski Hotel,
Accra, Ghana; the 35th Meeting of the Convergence Council of
Ministers and Governors of Central Banks of the WAMZ held at the
Movernpick Hotel, Accra, Ghana on January 15, 2016; the Bureau of
the Association of African Central Banks (AACB) 1st Ordinary
Meeting in Dakar, Senegal, held at the Headquarters of the Banque
Centrale des Etats de l'Afrique de I'Ouest (BCEAO) from March 1 to
3, 2016; and finally, the 9th Joint Annual Meetings of the African
Union Specialized Technical Committee on Finance, Monetary
Affairs, Economic Planning and Integration and the Economic
Commission for Africa Conference of African Ministers of Finance,
Planning and Economic Development held in Addis Ababa, Ethiopia
from March 31 to April 5, 2016.


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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 moderated at the end of first quarter of 2016. Banks’
deposit and lending rates trended downward during the review
quarter. The value of money market assets outstanding increased,
due largely, to the rise in FGN Bonds and treasury bills outstanding.
Transactions on the Nigerian Stock Exchange (NSE) were mixed as
some market indicators trended upward while others trended
downward.
Provisional data indicated that the key monetary aggregate
moderated at the end of the first quarter of 2016. On quarteron-quarter basis, broad money supply, (M2), at N20,470.4
billion, grew by 2.2 per cent, compared with the growth of 7.0
per cent at the end of the fourth quarter of 2015. The
development reflected the rise of 4.9 and 7.1 per cent in net
domestic credit and other assets (net) of the banking system,
respectively, which dampened the fall of 1.8 per cent in
foreign assets (net) of the banking system.
Narrow money supply (M1), grew by 5.5 per cent to N9,040.8
billion, at the end of the review quarter, compared with the
growth of 19.9 and 1.2 per cent at the end of the fourth
quarter of 2015 and the corresponding period of 2015,
respectively. The growth in (M1) was due to the growth of 6.8
per cent in demand deposit.
Quasi money fell by 0.3 per cent to N11,429.6 billion at the end
of the first quarter of 2016, against the 1.0 per cent decline at
the end of the fourth quarter of 2015. The development was
attributed to the decrease in time and savings deposits with
the DMBs (Fig. 1, Table 1).
key monetary
aggregate grew
during Q1 of 2016.


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Economic Report First Quarter

Figure 1: Growth Rate of Narrow Money (M1) and Broad Money (M2)1

At N22,664.8 billion, aggregate domestic credit to the
economy, quarter-on-quarter, grew by 4.9 per cent at the end
of the review quarter, compared with the growth rate of 0.4
and 7.1 per cent at the end of the fourth quarter of 2015 and
the
corresponding
period
of
2015,
respectively.
The
development reflected the 30.7 and 0.9 per cent growth in
net claims on the Federal Government and the private sector,
respectively.
Banking system’s credit (net) to the Federal Government rose
by 30.7 per cent to N3,782.6 billion, compared with the
respective growth of 3.8 and 72.8 per cent at the end of the
fourth quarter of 2015 and the corresponding period of 2015.
The development reflected increased holdings of government
securities by the banking system, especially treasury bills and
government bonds, which stood at 407 and 1.5 per cent,
respectively.
At N18,882.2 billion, banking system’s credit to the private
sector, quarter-on-quarter, grew by 0.9 per cent, in contrast to
the decline of 0.1 per cent at the end of the fourth quarter of

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

-15
-10
-5

-10
-5

Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Quarterly (%)
Cumulative (%)
QM1 (RHS)
QM2 (RHS)
CM1 (LHS)
CM2 (LHS)
Banking system credit
to the Federal
Government rose by
30.7 per cent at the
end of the first
quarter of 2016.


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Economic Report First Quarter

2015. The development reflected the 14.4 per cent increase in
claims on the State and Local Government.
Figure 2: Growth Rate of Aggregate Domestic Credit to the Economy2

At N5,551.7 billion, foreign assets (net) of the banking system
quarter-on-quarter, fell by 1.8 per cent at the end of the first
quarter of 2016, in contrast to the growth of 11.2 per cent at
the end of fourth quarter of 2015. The development was
attributed to the fall of 6.6 per cent in CBN’s holdings of
foreign assets.
Other Assets (net) of the banking system, quarter-on-quarter,
grew by 7.1 per cent to negative N7,746.1 billion at the end of
the review period of 2016, compared with increase of 8.2 per
cent at the end of fourth quarter of 2015, as against the
decrease of 13.4 per cent at the end of the corresponding
quarter of 2015.


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

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Quarterly (%)
Cumulative (%)
QCP (RHS)
QCG (RHS)
QAC (RHS)
CCP (LHS)
CCG (LHS)
CAC (LHS)
Foreign assets (net)
of the banking
system grew at the
end of the review
quarter.


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Table 1: Growth in Monetary and Credit Aggregates (Per cent) Over
Preceding Quarter
Jun-14
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Dec-15
Mar-16
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 N1,811.1billion, currency-in-circulation decreased by 2.5 per
cent in the review quarter, in contrast to the growth of 13.5
per cent at the end of the fourth quarter of 2015. The
development was due largely, to the decline in vault cash
during the review quarter.

Total deposits at the CBN amounted to N9,714.4 billion,
indicating a rise of 3.9 per cent relative to the level at the end
of the fourth quarter of 2015. The development reflected the
significant increase in private sector deposit. Of the total
deposits at CBN, the shares of the Federal Government, Banks
and ‘’Others’’ were N4,158.7 billion (42.8 per cent), N3,949.4
billion (40.7 per cent) and N1,606.3 billion (16.5 per cent),
respectively.
Reserve money (RM) fell by 0.9 per cent to N5,760.44 billion at
the end of the first quarter, reflecting the decrease in both
DMB’s reserves with the CBN and currency in circulation.
2.3
Money Market Developments
The money market was relatively liquid in most part of the first
quarter of 2016, resulting from payment of CBN maturated bills
and the expansionary monetary policy stance employed by
the Bank in the preceding quarter. However, the posting of
N340.11 billion CRR debit as well as provisioning for foreign
exchange on March 24, 2016 tightened liquidity and resulted
The financial market
was relatively liquid
during the review
period .
Reserve money (RM)
fell at the end of the
first quarter of 2016.


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Economic Report First Quarter

in a negative opening balance on March 30, 2016. Short-term
money market rates oscillated during the period but rose
above their levels in the fourth quarter of 2015.
Provisional data indicated that total value of money market
assets outstanding at the end of the first quarter of 2016 stood
at N9,751. 83 billion, showing an increase of 13.1 per cent
above the level in the fourth quarter of 2015. The
development reflected the 19.04 and 1.87 per cent growth in
FGN Bonds and treasury bills, respectively.
2.3.1
Interest Rate Developments
Available data indicated that banks’ deposit and lending
rates trended downward in the first quarter of 2016. All deposit
rates of various maturites fell from a range of 3.29 - 7.52 per
cent to 2.83 - 6.93 per cent. At 5.39 per cent, the average
term deposit rate declined by 0.73 percentage point below
the level in the fourth quarter of 2015. The average prime and
maximum lending rates fell by 0.24 and 0.15 percentage point
to 16.69 and 26.81 per cent, respectively. Consequently, the
spread between the weighted average term deposit and
maximum lending rates widened by 0.58 percentage point to
21.42 percentage points at the end of the first quarter of 2016.
Similarly, the margin between the average savings, deposit
and the maximum lending rates widened by 0.11 percentage
point to 23.77 percentage points. With headline inflation at
12.8 per cent at end-March 2016, all deposit rates were
negative in real terms, while lending rates were positive in real
terms.
At the inter-bank funds segment, the weighted average interbank call rate, which stood at 1.61 per cent at the end of the
fourth quarter of 2015, rose by 1.4 percentage point to 3.01
per cent in the first quarter of 2016, reflecting the liquidity
condition in the banking system. The Nigeria inter-bank offered
rate (NIBOR) for the 30-day tenor fell from 11.66 per cent in
the fourth quarter of 2015 to 8.02 per cent in the first quarter of
2016. However, the weighted average rate at the Open-BuyBack (OBB) segment rose by 0.81 percentage point to 2.92
per cent (Fig. 3, Table 2).
Interbank call
rate rose in Q1
2016.
The spread between
the weighted –
average term
deposit and
maximum lending
rates widened at
the end of the first
quarter of 2016.


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Economic Report First Quarter

Figure 3: Selected DMBs Interest Rates (Average)


Table 2: Selected Interest Rates (Percent, Averages)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Average Term Deposits

Prime Lending

Interbank

Maximum Lending


2.3.2
Commercial Paper (CP)
Commercial Paper (CP) outstanding held by DMBs declined
significantly to N0.45 billion in the first quarter of 2016,
compared with N6.96 billion in the fourth quarter of 2015. The
development reflected reduced investment in CP by the
commercial banks during the review quarter. As a ratio of
total money market assets, CP constituted 0.0046 per cent,
compared with 0.07 per cent at the end of the fourth quarter
of 2015.
2.3.3
Bankers’ Acceptances (BAs)
During the review period, BAs fell by 56.68 per cent to N12.31
billion, compared with N28.4 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 0.12 per cent of the total
value of money market assets outstanding, at the end of the

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Percent per Annum
Percent per Annum
Prime
Interbank
Maximum
Average Term Deposits (RHS)
Investment in CP by
banks fell in the
first quarter of
2016.
DMBs’ holdings of
BAs decreased
during Q1 of 2016.


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Economic Report First Quarter

first quarter of 2016, compared with 0.33 per cent at the end
of the fourth quarter of 2015.

2.3.4 Open Market Operations
Sixteen OMO auctions with tenors ranging from 147 to 280 day
tenors were conducted from January to March 2016. Total
amount offered, subscribed to and allotted was N774.86
billion, N2.191 trillion, and N1.602 trillion, respectively. The bid
rates range from 7.20 to 10.00 percent, while the stop rate was
7.60 to 9.00 per cent. The repayment of matured CBN bills was
N1.43 trillion thereby translating to a net injection of N176.49
billion through this medium. In the fourth quarter of 2015, only
3 auctions were conducted and the total amount on offer
was N200.00 billion for tenor ranging from 296-310 days, while
public subscription stood at N586.56 billion at bid rates ranging
from 7.00 to13.50 per cent. Allotment was N420.20 billion, while
the stop rate was at 8.00 per cent. CBN bills that matured and
were repaid in the review period amounted to N1, 410.81
billion thereby translating to a net injection of N990.61 billion
through this medium.
2.3.5
Primary Market
NTBs of 91- 182- and 364-day tenors amounting to N1,328.56
billion, N3,062.01 billion and N1,328.56 billion were offered,
subscribed to and allotted, respectively, in the first quarter of
2016. At the 91-day auction, total subscription and allotment
were N408.59 billion and N268.88 billion, respectively, with bid
rates ranging from 3.00 to 11.00 per cent, while the stop rates
were from 4.00 to 5.99 per cent. For the 182-day auction, total
subscription and allotment were N 703.31 billion and N298.31
billion, respectively. The bid rates ranged from 4.00 to12.00 per
cent, while the stop rates were 6.19 to 8.30 per cent. At the
364-day, total subscription and allotment were N1,950.11
billion and N761.37 billion, respectively, with bid rates
between 6.00 to 15.00 per cent, while stop rates were from
8.05 to 9.565 per cent. The bid to cover ratio was 2.31. The high
bid-to-cover ratio (above 2.0) indicated investors’ high desire
for the issues.


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Economic Report First Quarter

2.3.6
Bonds Market
A tranche of the 5-year bond and 10-year were reopened
during the review period. In addition, a new tranche of 20 –
year bond was offered for sale. The term to maturity of the
bonds ranged from 3 years, 11 months to 20 years. Total
amount offered, subscribed to and allotted were N270.00
billion, N645.64 billion and N265.00 billion, respectively. In
addition, N10.84 billion of the 5-year bond was allotted on
non-competitive basis in January 2016, while N5.00 billion and
N20.00 billion of the 5-year and 10-year was allotted on noncompetitive basis, respectively. The marginal rates for the 5-
year bond ranged from 11.33 to 12.24 per cent, for the 10-
year bond ranged from 12.09 to12.50 per cent, while that of
the 20-year was 12.04 per cent. However, for all the tenors, the
marginal rates were between 11.33 and 12.50 per cent. There
was no maturity in the period. In the fourth quarter of 2015,
existing tranches of the 5- and 10-year FGN Bonds were
reopened. The term to maturity of the bonds ranged from 4
years, 2 months to 8 years 5 months. Total amount offered,
subscribed to and allotted were N180.00 billion, N485.61 billion
and N180.00 billion, respectively. In addition, N20.00 billion of
the 5-year bond and N40.00 billion of the 10-year bond were
allotted on non-competitive basis. The marginal rates for the 5-
year bond ranged from 10.25 to 13.11 per cent, while the 10-
year bond ranged from 10.0100 to 13.8700 per cent. The
marginal rates for all the tenors were between 10.01 to13.87
per cent. There was no bond maturing in the review period,
resulting in a total withdrawal of N240.00 billion through this
medium.

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. The total request for the SLF granted
during the reviewed period was N450.51 billion (inclusive of
Intraday Liquidity Facility (ILF) converted to overnight repo),
compared with N1, 012.24 billion and N1, 644.07 billion in the
fourth quarter of 2015 and the corresponding period of 2015,
respectively. The Total deposit at the SDF window during the
review period was N6, 661.24 billion with daily average of
N111.02 billion, compared with N8,227.01 billion and N4, 741.61
Subscription for FGN
Bonds of various
maturities were
reopened during the
first quarter of 2016.


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Economic Report First Quarter

billion granted in the fourth quarter of 2015 and the
corresponding period of 2015, respectively.
2.4
Deposit Money Banks’ Activities
Available data indicated that the total assets and liabilities of
the commercial banks stood at N28,571.29 billion at the end of
the first quarter of 2016, representing an increase of 1.41 per
cent, compared with the level at the end of the the fourth
quarter of 2015. The funds were sourced, largely, from
increased capital accounts, reduction on claims on central
government and increase demand deposit. The funds were
used, mainly, to increase reserves, acquire foreign assets and
reduce time, savings and foreign currency deposit.
At N18,348.8 billion, banks’ credit to the domestic economy,
rose by 0.9 per cent, compared with 5.3 per cent at the end
of the fourth quarter of 2015. The development was attributed
to the increase in claims on both the Federal Government
and the private sector, at the end of the review quater.
Central Bank’s credit to the commercial banks rose by 3.6 per
cent to N776.47 billion, at the end of the review quarter. Total
specified liquid assets of the banks stood at N6,980.6 billion,
representing 39.9 per cent of their total current liabilities. At
that level, the liquidity ratio fell by 2.9 percentage points
below the level at the end of the fourth quarter of 2015 and
was 9.9 percentage points above the stipulated minimum
ratio of 30.0 per cent. The loans-to-deposit ratio, at 67.8 per
cent, was 1.8 and 12.2 percentage points below the levels at
the end of the fourth quarter of 2015, and the prescribed
maximum of 80.0 per cent, respectively.
2.5
Capital Market Developments
2.5.1
Secondary Market
Avaialable data indicated that developments on the Nigerian
Stock Exchange (NSE) were mixed during the first quarter of
2016. Total volume of traded securities rose significantly by 90.2
per cent to 34.9 billion shares, while the value of traded
securities fell by 13.8 per cent to N148.9 billion in 202,644 deals,
in the review quarter, compared with 18.4 billion shares and
N172.6 billion in 175,429 deals in the fourth quarter of 2015. The
Financial Services Industry led the activity chart (measured by
volume).
Liquidity ratio in Q1
was
above
the
stipulated
minimum, while the
Loan-to-deposit
ratio was below the
prescribed
maximum.


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Economic Report First Quarter

Figure 4: Volume and Value of Traded Securities


Table 3: Traded Securities on the Nigerian Stock Exchange (NSE)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Volume (Billion)

Value (N Billion)


2.5.2
New Issues Market/Supplementary Listings
There was one (1) supplementary listing in the review quarter (table 4)
Table:4 New and Supplementary Listing on the Nigerian Stock Exchange
S/N Company
Additional Shares (Units)
Reasons
Listing
1 Sterling Bank Plc
7,197,604,531
Special placing
Supplementary

2.5.3
Market Capitalization
Aggregate market capitalization for all listed securities
(Equities and Bonds) stood at N15.88 trillion, indicating a
decrease of 6.6 per cent below the level at the end of the
fourth quarter of 2015. Similarly, market capitalization for the
listed equities declined by 11.6 per cent below the level in the
fourth quarter of 2015 to close at N8.71 trillion at the end of
the review quarter. Listed equities accounted for 54.9 per cent
of the aggregate market capitalization, compared with 58.0
per cent at the end of the fourth quarter of 2015.

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Value (N billion)
Volume (Billion)
Volume of traded securities (LHS)
Value of securities (RHS)


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2.5.4 NSE All-Share Index
The All-Share Index, which opened at 28,642.25 at the
beginning of the period, closed at 27,385.69, representing a
decrease of 11.6 per cent below the level at the end of fourth
quarter of 2015. In the review quarter, all the sectoral indices
fell below their levels in the fourth quarter of 2015. The NSE
Banking, NSE Insurance, NSE Consumer goods, NSE Oil/Gas,
NSE Lotus Islamic, NSE Industrial, NSE AseM, NSE Pension and
NSE Premium indices fell by 19.7, 10.7, 17.5, 1.1, 11.3, 9.5, 0.3,
14.9 and 4.6 per cent to close at 215.47, 127.01, 615.49, 352.65,
1772.18, 1961.0, 1204.91, 694.03 and 1511.58, respectively.
Figure 5: Market Capitalization and All-Share Index


Table 5: Market Capitalization and All Share Index (NSE)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Market Capitalization (N trillion)

All-Share Index (Equities)
38,748.01

42,482.48

41,210.10

34,657.15

31,744.82

33,456.86

31,217.77

26,871.24

27,385.69


Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
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 First Quarter

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

Economic Report First Quarter

3.0
Fiscal Operations
3.1
Federation Account Operations
Provisional data indicated that federally-collected revenue, at
N1,268.59 billion, during the first quarter of 2016, was lower
than the 2015 quarterly budget estimate of N2,444.60 by 48.1
per cent. This was also below the receipts in the fourth quarter
of 2015 by 18.0 per cent. The decline in federally-collected
revenue (gross) relative to the 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

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Oil Revenue Gross
Non-Oil Revenue
N Billion

Table 6: Gross Federation Account Revenue (N billion)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Federally-collected revenue (Gross)

Oil Revenue

Non-Oil Revenue


At N666.13 billion or 52.5 per cent of the total revenue, gross oil
receipt was lower than the provisional quarterly budget and
the receipts in the fourth quarter of 2015 by 50.9 and 19.8 per
cent, respectively. The decline in oil revenue relative to the
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 as well as series of
Gross federally -
collected revenue
fell by 18.0 per
cent below the
level in the fourth
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 First Quarter

shut-ins and shut-downs at some NNPC terminals owing to
pipeline vandalism and repairs during the review quarter (Fig.
7, Table 7).
Figure 7: Gross Oil Revenue and Its Components
-


Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
N billion
Others
PPT/Royalties
Crude oil/Gas Sales

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


At N602.46 billion or 47.5 per cent of total revenue, gross nonoil receipts fell below the provisional budget estimate and
receipts in the fourth quarter of 2015 by 44.6 and 16.0 per
cent, respectively. The decline in non-oil revenue relative to
the provisional budget estimate was due, largely, to the fall in
receipts from all of its components except Customs Special
Levies (Non-Federation Account) during the review quarter
(Fig. 8, Table 8).
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
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 First Quarter

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

1,000
1,200
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
N billion
Others
Customs & Excise Duties
Companies Income Tax & Other Taxes
Value-Added Tax (VAT)

Table 8: Components of Gross Non-Oil Revenue (N billion)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
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 N855.40
billion was transferred to the Federation Account for
distribution among the three tiers of government and the
13.0% Derivation Fund. The sums of N40.31 billion, N188.71
billion and N53.81 billion were transferred to the Federal
Government Independent Revenue, VAT Pool Account and
Others, repectively. The Federal Government received
N412.24 billion, while the state and local governments
received N209.09 billion and N161.20 billion, respectively. The
balance of N72.86 billion was allocated to the 13.0%
Derivation Fund for distribution among the oil-producing
states. Also, the Federal Government received N28.31 billion
from the VAT Pool Account, while the state and local
governments received N94.35 billion and N66.05 billion,
respectively.

The
sum
of
N1,138.22 billion
out of the gross
federally
collected revenue
was
distributed
among the three
tiers
of
government and
13.0% Derivation
Fund
for
oil
producing states.


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

Economic Report First Quarter

The sum of N11.21 billion was also distributed as Exchange
Gain among the three tiers of government and the 13%
Derivation Fund as follows: Federal Government (N5.23 billion),
State Governments (N2.65 billion), Local Governments (N2.04
billion) and 13% Derivation Fund (N1.29 billion).
In addition, the sum of N18.99 billion was received by the
Federal Government being NNPC monthly installment refund
of N6.33 billion paid in the first quarter of 2016.
Thus, the total statutory and VAT revenue allocation to the
three tiers of government in the first quarter of 2016 amounted
to N1,074.31 billion, compared with the provisional quarterly
budget estimate of N1,994.77 billion and N1,200.59 billion
received in the fourth quarter of 2015.
3.2
The Fiscal Operations of the Three Tiers of
Government

3.2.1
The Federal Government

The Federal Government retained revenue for the first quarter
of 2016 based on provisional data amounted to N505.07
billion. This was below the receipts in the fourth quarter of 2015
by 37.5 per cent. Of the total revenue, Federation Account
accounted for 81.6 per cent, while Federal Government
Independent Revenue, VAT, and Others (NNPC Refund and
Exchange Gain) accounted for 8.0, 5.6 and 4.8 per cent,
respectively (Fig. 9, Table 9).
At N505.07 billion, the
estimated
Federal
government
retained
revenue
was
lower
than the receipts in the
preceding quarter by
37.5 per cent.


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

Economic Report First Quarter

Figure 9: Federal Government Retained Revenue
Federation
Account
(81.6%)
VAT Pool
Account (5.6%)
Others (4.8%)
FGN Independent
Revenue (8.0%)


Table 9: Federal Government Fiscal Operations (N billion)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Retained Revenue

Expenditure

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


At N1,230.25 billion, provisional data indicated that Federal
Government expenditure for the first quarter of 2016 was
above the provisional quarterly budget estimate by 3.4 per
cent, but was below the level in the fourth quarter of 2015 by
20.3 per cent. The development relative to the proportionate
quarterly budget estimate was attributed, mainly, to the rise in
capital expenditure. A breakdown of the total expenditure
showed that the recurrent component accounted for 72.8 per
cent, while capital and statutory transfers accounted for 18.0
and 9.2 per cent, repectively (Fig. 5). A further breakdown of
the
recurrent expenditure
showed that the
non-debt
component accounted for 72.7 per cent, while debt service
payments accounted for the balance of 27.3 per cent.
Thus, the fiscal operations of the Federal Government resulted
in an estimated deficit of N725.18 billion, which indicated an
Fiscal
operations
of the FG resulted
in an estimated
deficit of N289.12
billion

in
Q4
2015.
Fiscal
operations
of the FG resulted
in an estimated
deficit of N725.18
billion

in
Q1
2016.


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

Economic Report First Quarter

increase of 178.6 per cent above the 2015 provisional
quarterly budget deficit of N260.25 billion.
Figure10: Federal Government Expenditure
Recurrent
Capital
Transfers
Capital
(18.0%)
Transfers
(9.2%)
Recurrent (72.8%)


3.2.2
Statutory Allocations to State Governments

Total
allocation
to
state
governments
(including
the
Federation Account, 13.0% Derivation Fund and VAT) stood at
N380.25 billion during the review quarter. This was 45.6 and 8.0
per cent lower than both the provisional budget estimate and
the level in the fourth quarter of 2015, respectively. Further
breakdown showed that receipts from the Federation
Account was N285.90 billion (75.2 per cent), while VAT
contributed N94.35 billion (24.8 per cent). The share of
Federation Account was 12.8 per cent lower than the level in
the fourth quarter of 2015. However, receipts from the VAT
Pool Account rose by 10.6 per cent above the level in the
fourth quarter of 2015.
3.2.3
Statutory Allocations to Local Government Councils

Provisional allocations to local governments
from the
Federation and VAT Pool Accounts in the first quarter of 2016
stood at N229.29 billion. This was 46.7 and 8.9 per cent below
the provisional budget estimate and the level in the fourth
quarter of 2015, respectively. Of the total amount, allocation
from the Federation Account was N163.25 billion (71.2 per


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

Economic Report First Quarter

cent), while VAT Pool Account accounted for the balance of
N66.05 billion (28.8 per cent).


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

Economic Report First Quarter

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

Economic Report First Quarter

4.0
Domestic Economic Conditions
Activities in the agrcultural sector remained moderate, as farmers
engaged in preparations for early planting and off season
cultivation. Farmers in the South engaged in harvesting of tree crops
and clearing of land for 2016 wet season farming, while tending of
irrigation-fed vegetable and cereal crops were undertaken in the
Northern states. In the livestock sub-sector, there were market
disruptions in some major cattle markets in the Northern states,
especially Borno, leading to temporary closures due to increased
rustling by the insurgents. Crude oil production was estimated at 1.82
million barrels per day (mbd) or 165.62 million barrels for the quarter.
The end-period inflation rate for the first quarter of 2016, on year-onyear basis, was 12.8 per cent, compared with 9.6 and 8.5 per cent at
the end of the fourth quarter of 2015 and the corresponding quarter
of 2015, respectively. The inflation rate on a 12-month moving
average basis was 9.8 per cent, compared with 9.0 per cent at the
end of the fourth quarter of 2015.
4.1
Agricultural Sector
Available data indicated that agricultural activities during the
first quarter of 2016 remained moderate, as farmers engaged
in preparations for early planting and off season cultivation.
Major agricultural activities in the Southern states were
harvesting of tree crops and clearing of land for 2016 wet
season farming, while tending of irrigation-fed vegetable and
cereal crops were undertaken in the Northern states. In the
livestock sub-sector, increased rustling by the insurgents
caused disruptions and temporary closures in some major
cattle markets in the Northern states, especially Borno. For
poultry, farmers increased the raising of broilers and layers in
preparation for the 2016 Easter celebrations.
4.2 Agricultural Credit Guarantee Scheme
A total of N1,640.0 million was guaranteed to 11,369 farmers
under the Agricultural Credit Guarantee Scheme (ACGS) in
the first quarter of 2016. The amount represented decrease of
47.0 and 40.6 per cent below the levels in the fourth quarter of
2015 and the corresponding period of 2015, respectively. Subsectoral analysis showed that food crops got the largest share
of N1,091.3 million (66.5 per cent) guaranteed to 8,587
beneficiaries, livestock got N262.1 million (16.0 per cent)
guaranteed to 1,070 beneficiaries, fisheries had N124.4 million
(7.6 per cent) guaranteed to 489 beneficiaries, while Mixed


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

Economic Report First Quarter

crop received N68.8 million (4.2 per cent) guaranteed to 530
beneficiaries. The Cash Crop sub-sector received N62.8 million
(3.8 per cent) guaranteed to 476 beneficiaries, while ‘Others’
received a total of N30.7 million (1.9 per cent) guaranteed to
217 beneficiaries.
Analysis by state showed that 34 states and the Federal
Capital Territory benefited from the Scheme in the review
period, with the highest and lowest sums of N271.6 million (16.6
per cent) and N0.7 million (0.05 per cent) guaranteed to Edo
and Gombe States, respectively,
At end-March 2016, total amount released by the CBN under
the Commercial Agriculture Credit Scheme (CACS) from
inception to the participating banks for disbursement stood at
N336.3 billion for 420 projects(Table 10), the same as in the
fourth quarter of 2015.


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

Access Bank Plc
16.6

Citibank Plc
3.0

Diamond Baqnk Plc
4.4

ECOBANK
6.4

FCMB Plc.
10.0

Fidelity Bank Plc
14.9

First Bank of Nigeria Plc
37.1

GTBank Plc
17.4

Heritage Bank Plc
4.8

Keystone Bank
2.2

Jaiz Bank Plc
1.0

Skye Bank Plc
11.8

Stanbic IBTC Bank
18.5

Sterling Bank Plc
23.7

Union Bank Nigeria PLC
21.6

United Bank for Africa (UBA) Plc
52.8

Unity Bank Plc
24.3

Wema Bank
1.2

Zenith Bank
64.7

TOTAL
336.3

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

Economic Report First Quarter

4.3
Industrial Production
Available data on Industrial activities during the first quarter of
2016 indicated a decline, compared with the level at the end
of the fourth quarter of 2015. At 111.1 (2010=100), the
estimated index of industrial production fell marginally by 0.01
and 0.05 per cent below the levels in the the fourth quarter of
2015 and the corresponding period of 2015, respectively. The
decrease relative to the fourth quarter of 2015 was attributed
to the decline in activities in all the sub-sectors during the
period.
The estimated index of manufacturing production in the first
quarter of 2016, at 190.2 (2010=100), showed a marginal
decrease of 0.01 per cent relative to the level in the fourth
quarter of 2015. It, however, indicated a 0.02 per cent
increase, compared with the level in the corresponding
period of 2015. Capacity utilisation was estimated at 52.7 per
cent, indicating a 1.0 percentage point decrease, compared
with the level in the fourth quarter of 2015. The development
was attributed to the poor power supply, exchange rate
challenges and squeezed cash flow, which impacted on
business confidence, hindering activities in the sector
(Fig.11).
Figure11: Manufacturing Capacity Utilization Rate


Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Percent
Industrial activities
fell in the review
quarter due to
reduced activities in
all sub-sectors.
Industrial
capacity
utilization
was
estimated to decline
by
1.0
percentage
points
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 First Quarter

At 75.0 (2010=100), the estimated index of mining production
in the first quarter of 2016, indicated 0.02 and 0.14 per cent
decrease relative to the levels attained in the fourth quarter of
2015 and the corresponding period of 2015, respectively. The
decrease in mining production during the review quarter was
due to a significant fall in crude oil and gas production.
At 3,871 MW/h, estimated average electricity generation in
the first quarter of 2016 fell by 0.08 per cent, compared with
the level attained in the fourth quarter of 2015. The
development was attributed to the fall in generation in the
various power plants due to vandalism, and the fall in water
supply to the hydro power stations.
At 3,679.2 MW/h, average estimated electricity consumption
fell by 0.04 per cent relative to the level attained in the fourth
quarter of 2015. The fall in electricity consumption was
attributed to a decline in generation and transmission losses
(Fig. 12, Table 11).
Figure 112: Index of Industrial Production (2010=100) 3

Q1-14 Q2-14 Q3-14 Q4-14 Q1-15 Q2-15 Q3-15 Q4-15 Q1-16
Index
Mining
All Sectors
Manufacturing


3 Index measurement at (2010=100) from first quarter15
Average electricity
generation and
consumption fell
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 First Quarter

Table 11: Index of Industrial Production and Manufacturing Capacity Utilization Rate
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
All Sectors (1990=100)

Manufacturing

Mining


Capacity Utilization (%)


4.4
Petroleum Sector
Nigeria’s crude oil production, including condensates and
natural gas liquids, was estimated at an average of 1.82
million barrels per day (mbd) or 165.62 million barrels (mb) for
the first quarter of 2016. This represented a decline of 0.07 mbd
or 3.7 per cent, relative to 1.89 mbd or 173.88 million barrels
produced in the fourth quarter of 2015.
Crude oil export stood at 1.37 mbd or 124.67 million barrels.
This represented a decline of 4.9 per cent, compared with 1.44
mbd or 132.48 mb recorded in the fourth quarter of 2015.
Supply disruption owing to continued attacks on oil
installations by vandals accounted for the decline in crude oil
production.
Deliveries
to
the
refineries
for
domestic
consumption remained at 0.45 mbd or 40.95 million barrels
during the review quarter.
At an estimated average of US$34.39 per barrel, the price of
Nigeria’s reference crude, the Bonny Light (37o API), fell by
22.0 per cent, compared with the level in the fourth quarter of
2015. The average prices of other competing crudes, namely
the U.K Brent, the West Texas Intermediate and the Forcados,
at US$33.64, US$33.48 and US$34.01 per barrel, respectively,
also fell below their levels in the fourth quarter of 2015.
The average price of OPEC’s basket of eleven crude streams,
at US$30.16 per barrel, indicated a fall of 24.4 and 40.0 per
cent, compared with the average of US$39.90/b and
US$50.30/b recorded in the fourth quarter of 2015 and the
corresponding period of 2015, respectively (Fig. 13, Table 12).


Crude oil and
natural gas
production
decreased in the
first quarter of 2016.
Crude oil export
decreased in Q1
2016.
Average crude oil
prices, including
Nigeria’s Bony
Light (37o API) fell
in the international
crude oil market in
Q1 2016.


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

Economic Report First Quarter

Figure123: Trends in Crude Oil Prices

Table 12: Average Crude Oil Prices in the International Oil Market
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
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 first quarter of
2016, was 189.9 (November 2009=100), representing increase
of 5.4 and 12.8 per cent, compared with the levels in the
fourth quarter of 2015 and the corresponding quarter of 2015,
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; education; furnishing, household equipment and
maintenance; and health.

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.

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
US$ per barrel
Bonny Light
OPEC Basket
The general price
level rose in Q1,
compared with the
level in the fourth
quarterof 2015.


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

Economic Report First Quarter

The urban all-items CPI at the end of the first quarter of 2016
was 190.0 (November 2009=100), indicating an increase of 6.0
and 13.5 per cent above the levels in the fourth quarter of
2015 and the corresponding period of 2015, respectively.
Similarly, the rural all-items CPI, at 189.9 (November 2009=100),
represented increase of 4.9 and 12.0 per cent above the
levels in the fourth quarter of 2015 and the corresponding
period of 2015, respectively (Fig. 14, Table 13).
The composite food index (with a weight of 50.7 per cent) was
194.9 per cent, representing an increase of 4.7 per cent,
compared with the 186.2 per cent at the end of the fourth
quarter of 2015. The development was attributed to the
increase in the prices of farm produce (vegetables, yam,
potatoes, and other tubers, rice, millet, and fruits) and
processed food.
Figure134: Consumer Price Index

Table 13: Consumer Price Index (November 2009=100)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Composite

Urban

Rural


147.5

152.5

157.5

162.5

167.5

172.5

177.5

182.5

187.5

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Index
Composite
Urban
Rural


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

Economic Report First Quarter

The inflation rate at the end of the review quarter, on a yearon-year basis, was 12.8 per cent, compared with 9.6 and 8.5
per cent in the fourth quarter of 2015 and the corresponding
period of 2015, respectively. On a twelve-month moving
average basis, the inflation rate was 9.8 per cent, indicating a
0.8 percentage point increase above the level recorded in
the fourth quarter of 2015 (Fig. 15, Table 14).
Figure 15: Inflation Rate


Table 14: Headline Inflation Rate (%)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
12-Month Moving Average

Year-on-Year


Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Percent
12-Month Average
Year-on-Year
The headline
inflation (y-o-y)
stood at 12.8 per
cent in Q1 2016.


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

Economic Report First Quarter

5.0
External Sector Developments
Provisional data showed that foreign exchange inflow and outflow
through the CBN in the first quarter of 2016 fell by 44.2 and 24.5 per
cent, respectively, below the levels in the fourth quarter of 2015.
Total non-oil export receipts increased by 38.6 per cent, relative to
the level in the fourth quarter of 2015, but decreased by 43.6 per
cent, relative to the level in the corresponding quarter of 2015. The
average
exchange
rate
at
the
inter-bank
segment
was
N197.00/US$, compared with N196.99/US$ at the end of the fourth
quarter of 2015. At US$27.56 billion, the gross external reserves fell by
2.6 per cent, compared with the level at the end of the fourth
quarter of 2015.
5.1
Foreign Exchange Flows
Provisional data showed that foreign exchange inflow and
ouflow through the CBN in the first quarter of 2016 were
US$3.98 billion and US$5.85 billion, respectively. This resulted in
a net outflow of US$1.87 billion, compared with the net outflow
of US$0.62 billion in the fourth quarter of 2015. Relative to the
level at the end of the fourth quarter of 2015 and the
corresponding period of 2015, inflow declined by 44.2 and
52.0 per cent, respectively. The development was due to the
decline in both oil and non-oil receipts. Similarly, outflow fell by
24.5 and 54.5 per cent, below the levels in the fourth quarter
of 2015 and the corresponding period of 2015, respectively.
The development relative to the fourth quarter of 2015 was
due largely to the outward transactions in respect of interbank
sales, swaps and other official payments (Fig.16, Table 15).


Foreign exchange
inflow and outflow
through the CBN fell
by 44.2 and 24.5 per
cent, respectively,
and resulted in a net
outflow of US$1.87
billion in Q1 of 2016.


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

Economic Report First Quarter

Figure 16: Foreign Exchange Flows Through the CBN


Table 15: Foreign Exchange Flows Through the CBN (US$ million)
Q4-13
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q1-16
Inflow
10,221.43

12,676.51

13,094.23

10,641.86

8,307.23

6,976.02

11,111.00

7,135.41

3,984.50

Outflow
15,695.66

12,806.25

11,804.98

14,527.35

12,875.77

8,194.56

9,523.32

7,757.49

5,853.20

Netflow
(5,474.23)

(129.74)

1,289.25

(3,885.49)

(4,568.54)

(1,218.54)

1,587.68

(622.08)

(1,868.70)


Provisonal data on aggregate foreign exchange inflow into
the economy indicated that total inflow was US$15.43 billion.
This represented decline of 24.0 and 20.8 per cent below the
levels in the fourth quarter of 2015 and the corresponding
period of 2015, respectively. The development was driven by
the fall in receipts from both the CBN and autonomous
sources. Oil sector receipts, which accounted for 19.1 per cent
of the total, stood at US$2.94 billion, compared with US$3.99
billion and US$5.59 billion, recorded in the fourth quarter of
2015 and the corresponding period of 2015, respectively.
Non-oil public sector inflow, at US$1.05 billion (6.8 per cent of
the total), fell by 66.7 per cent and 61.4 per cent below the
levels in the fourth quarter of 2015 and the corresponding
period of 2015, respectively. Autonomous inflow, which
accounted for 74.2 per cent of the total, fell by 13.0 per cent,
compared with the level in the fourth quarter of 2015.
At US$6.47 billion, aggregate foreign exchange outflow from
the economy fell by 25.0 and 51.1 per cent below the levels in
Autonomous inflow
into the economy fell
by 13.0 per cent in
Q1 2016 .
-10,000
-5,000


Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
US$ million
Inflow
Outflow
Netflow


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the fourth quarter of 2015 and the corresponding period of
2015, respectively. The development, relative to the fourth
quarter of 2015, was accounted for by the decline in
interbank sales and stoppage of foreign exchange sales to
the BDCs. Thus, foreign exchange flows through the economy
resulted in a net inflow of US$8.96 billion in the review quarter,
compared with US$11.68 billion and US$6.26 billion in the fourth
quarter of 2015 and the corresponding period of 2015,
respectively.
5.2
Non-Oil Export Earnings by Exporters
Provisional data showed that total non-oil export earnings, at
US$1.02 billion, increased by 38.6 per cent, above the level in
the fourth quarter of 2015, but declined by 43.6 per cent at
the
end
of
the
corresponding
period
of
2015.
The
development, relative to the fourth quarter of 2015, was
attributed, mainly, to the significant decline in receipts from
industrial and agricultural export products. A breakdown by
sectors showed that proceeds from manufactured products,
minerals, agricultural products, industrial, food products and
transport sector stood at US$546.38 million, US$255.15 million,
US$87.53 million, US$79.97 million, US$46.22million and US$0.12,
respectively.
The percentage shares of manufactured products, minerals,
agricultural products, industrial, food products and transport
in the total non-oil export proceeds were 53.8, 25.1, 8.6, 7.9, 4.6
and 0.01, respectively.
5.3
Sectoral Utilisation of Foreign Exchange

The invisible sector accounted for the bulk (32.9 per cent) of
total foreign exchange disbursed in the first quarter of 2016,
followed by the industrial sector (24.1 per cent). The
contributions of other sectors in a descending order included:
minerals and oil sector (19.0 per cent), manufactured
products (13.1 per cent), food products (7.3 per cent),
transport sector (2.7 per cent) and agricultural products (0.9
per cent) (Fig.17).
.
The invisible sector
accounted for the
bulk of the total
foreign exchange
disbursed during
Q1 2016.
Total non-oil export
earnings by
exporters rose
during the first
quarter of 2016.


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Figure17: Sectoral Utilisation of Foreign Exchange

5.4
Foreign Exchange Market Developments5
A total of US$4.67 billion was sold by the CBN to authorized
dealers during the first quarter of 2016. This reflected decline of
33.5 and 57.3 per cent below the levels in the fourth quarter of
2015 and the corresponding period of 2015, respectively. The
development, relative to the fourth quarter of 2015, was
attributed to the decrease in sales at the inter-bank segment
and closure of the BDC segment in January 2016. Of the
aggregate, inter-bank, swaps and BDC sales were US$3.43
billion, US$0.94 billion and US$0.30 billion, respectively (Fig. 18,
Table 16).


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


Percent of Total
Q3-15
Q4-15
Q1-16
Supply for foreign
exchange by
authorized dealers
fell during Q1 2016.


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Figure 18: Supply of Foreign Exchange


Table 16: Demand for and Supply of Foreign Exchange (US$ billion)
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Forex Sales at rDAS/Interbank
8.29
7.06
3.18
MC
MC
MC
3.43
Supply of Swaps
10.58
14.08
8.47
MC
MC
MC
0.94
Supply of Forex to BDC

Total Forex Supply(BDC and rDAS)


The average exchange rate at the inter-bank segment was
N197.00/US$, compared with N196.99/US$ at the end of the
fourth quarter of 2015. It showed a depreciation of 0.01 and
2.89 per cent relative to the rate in the fourth quarter of 2015
and the corresponding quarter of 2015, respectively. (Fig. 19,
Table 17).

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
US$ billion
Forex Sales at rDAS/Interbank
Supply of Swaps
Supply of Forex to BDC
Total Forex Supply
The average naira
exchange rate vis-àvis the US dollar was
N197.00/US$ at the
interbank segment in
Q1 2016.


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Figure 19: Average Exchange Rate Movements

Table 17: Exchange Rate Movements and Exchange Rate Premium
Average Exchange Rate (N/US$)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
rDAS

169.68 N/A
N/A
N/A
N/A
BDC

Interbank

Premium (%)
rDAS/BDC

23.5 N/A
N/A
N/A
N/A
rDAS/Interbank

12.6 N/A
N/A
N/A
N/A
BDC/Interbank


Figure 20: Exchange Rate Premium

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
N/US $
Average wDAS/rDAS
Average BDC
Average Interbank

Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
Per cent
rDAS/BDC
rDAS/Interbank
Interbank/BDC


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5.5
Gross Official External Reserves
Gross external reserves at the end of the first quarter of 2016
stood at US$27.56 billion, showing a decline of 2.6 and 6.1 per
cent, compared with the levels in the fourth quarter of 2015
and the corresponding period of 2015, respectively. The
development, relative to the fourth quarter of 2015, was due
to interbank sales, swaps, official payments as well as public
sector payments. A breakdown of the official external reserves
showed that CBN reserves stood at US$18.76 billion (68.1 per
cent), Federation reserves, US$2.45 billion (8.8 per cent) and
the Federal Government reserves, US$6.35 billion (23.1 per
cent) (Fig. 21, Table 18).
Figure 21: Gross Official External Reserves


Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
US$ million

Table 18: Gross Official External Reserves (US$ million)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
External Reserves
37,376.4

37,330.0

38,278.6

34,241.5

29,357.2

28,335.2

29,850.1

28,287.6

27,564.0


Gross external
reserves
declined during
the first quarter
of 2016.


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6.0 Global Economic Conditions
6.1 Global Output
Global
growth
remained
modest
and
uneven.
While
economic activities continued to expand at a solid pace in
advanced economies, developments in emerging market
economies remained weak and more diverse. Increased
uncertainties in Chinese economy and persistent oil price
decline led to renewed downward pressures on euro-area
sovereign bond yields. According to the IMF, risks to the global
outlook remained tilted to the downside and relate to
ongoing adjustments in the global economy, a generalized
slowdown
in
emerging
market
economies,
China’s
rebalancing, lower commodity prices, and the gradual exit
from extraordinarily accommodative monetary conditions in
the United States. If these key challenges are not successfully
managed, global growth could be derailed.
6.2 Global Inflation
Global headline inflation had remained very low, especially in
many advanced economies and also in china, and is
considerably higher in some large economies, including
Russia, Brazil and Turkey, reflecting the fall in oil prices. Annual
consumer price inflation in the OECD area was up owing to a
less negative contribution from energy prices. Further decline
in oil and other commodity prices are expected to dampen
inflationary pressures.
Among the major emerging economies, consumer price
inflation is set to remain relatively low in China and India.
Inflation is projected to remain stronger for sometime in
countries such as Russia, Brazil and Indonesia, due to the
impact of past currency depreciations.
In the sub-Saharan Africa region, inflation is expected to
remain high due to the negative impact of low commodity
prices
on
export
earnings.
The
impact
of
currency
depreciation was also expected to pass through to inflation.
6.3 Global Commodity Demand and Prices
World crude oil demand was estimated at 93.15 mbd in the
first quarter of 2016, representing a decrease of 0.8 per cent
below the 93.95 mbd recorded in the fourth quarter of 2015.
World crude oil supply in the review quarter was estimated at


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95.70 mbd, representing an increase of 0.6 per cent,in contrast
with the level in the fourth quarter of 2015.
The price of OPEC Reference Basket (ORB) averaged US$30.16
per barrel in the first quarter of 2016, representing a decrease
of 24.4 per cent compared with the level in the fourth quarter
of 2015. The development was attributed to the lifting of
sanctions on Iran, resulting in the worsening of the
already existing oversupply situation in the market,
continued slowdown in China's economic growth,
strengthening US Dollar and a sharp fall in Asian equity
markets.
6.4
International Financial Markets
Developments in the international stock markets were mixed
during the review period. In Europe, the FTSE 100, CAC 40 and
DAX indices all decreased by 0.8, 5.4 and 7.2 per cent,
respectively, while MICEX increased by 6.2 per cent. In Asia,
China’s Shanghai Stock Exchange-A, Japan’s Nikkei 225 and
India’s BSE Sensex indices declined by 15.1, 12.0 and 3.0 per
cent, respectively.
In North America, the S&P 500, Canada S&P/TSX Composite
and Mexican Bolsa Indices increased by 0.8, 3.7 and 6.8 per
cent, respectively. In South America, the Brazilian Bovespa,
Argentine Merval index and Columbian IGBC General index
increased by 15.5, 11.3 and 15.8 per cent, respectively.
In Africa, the South African JSE AS index and Egyptian EGX CSE
30 increased by 3.1 and 7.4 per cent, respectively, while
Nigerian All-Share, Kenyan Nairobi NSE 20 and Ghanaian GSE
All-Share indices decreased by 11.6, 1.5 and 4.2 per cent,
respectively.
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 official visit of the Managing Director (MD) of the
International Monetary Fund (IMF) to Abuja, Nigeria from
January 4 – 7, 2016. The objective of the visit was to strengthen


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the Fund’s partnership and cooperation with Nigeria being the
largest economy in sub-Saharan Africa (SSA). Discussions
during the visit centered on issues and challenges confronting
the Nigerian economy, such as the impact of low commodity
prices, foreign exchange policy as well as the need to diversify
the Nigerian economy. The MD pledged the IMF’s support
through policy advice and capacity building. At the end of
the meeting, policy recommendations towards improving the
competitiveness of the Nigerian economy were articulated.
These included:

the need to improve on the provision of critical
infrastructure,
especially
power,
transportation,
and
housing;

Broadening of the country’s revenue base to create
additional fiscal space and offset the impact of lower oil
prices; and

the need for prudent considerations on borrowing, public
spending and fuel subsidies with a view to safeguarding
priority social sectors and the most vulnerable groups. This
would require a package of measures involving businessfriendly monetary policy, flexible exchange rate policy,
and
disciplined
fiscal
policy,
as
well
as
the
implementation of structural reforms.
The 2015 End-of-Year Statutory Meetings of the West African
Monetary Zone (WAMZ), West African Monetary Agency
(WAMA), and the West African Institute for Financial and
Economic Management (WAIFEM) were held at the Kempinski
Hotel, Gold Coast City, Accra, Ghana from January 8 – 15,
2016. The technical committee meetings took place from
January 8 – 13, 2016 followed by the Committee of Governors
meeting on January 14, 2016 and the meeting of the
convergence council on January 15, 2016. The meetings had
in attendance representatives from member central banks in
the ECOWAS, ECOWAS Commission, Ministries of Finance, EBID
and other observers.
The 32nd Meeting of the Committee of Governors of Central
Banks of the West African Monetary Zone (WAMZ) was held on
January 14, 2016 at the Kempinski Hotel, Gold Coast, Accra,
Ghana. After deliberations the COG Adopted the Report on


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Macroeconomic Developments and convergence in the
WAMZ as at the end of June, 2015 and urged Member States
to:

redouble their efforts to ensure the attainment of the
minimum level of convergence required for the
establishment of ECOWAS monetary union by 2020;

address the infrastructure gaps by providing adequate
funding for electricity, energy, road and railways. In this
regard, Member States should explore sustainable
funding options such as the issuance of infrastructure
bonds and PPP arrangements;

further strengthen fiscal consolidation by addressing all
tax administration inefficiencies, broadening revenue
base,
rationalizing
expenditure
and
restructuring
maturity profiles of debts;

provide monthly data on key indicators to enable
WAMI regularly update the analysis of macroeconomic
developments in the Zone:

commence the implementation of the CET as soon as
possible; and

adopt end-period inflation for the assessment of
macroeconomic
convergence
in
view
of
its
appropriateness in the formulation of monetary policy
among others.
The 47th meeting of the Committee of Governors of ECOWAS
member Central Banks was held on January 14, 2016 at the
Kempinski Hotel, Accra, Ghana. After deliberations, the COG:

noted that the tenure of the current Director General of
WAMA would come to an end on May 31, 2016;

directed that WAMA should ensure that the vacant
positions at the Institute were identified and distributed
to member countries on the principle of equity and
geographical representation of the respective member
States among others: and

directed that going forward, the Director General
should officially inform the Committee of Governors, at
least one year before the end of his tenure, to allow for
adequate arrangements to recruit his/her successor.


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The 35th Meeting of the Convergence Council of Ministers and
Governors of Central Banks of the WAMZ was held at the
Movernpick Hotel, Accra, Ghana on January 15, 2016 to
consider the report of the 32nd Meeting of the Committee of
Governors of Central Banks of the WAMZ. Following the
Council’s deliberations, all the recommendations of the
Committee of Governors of the WAMZ were endorsed and
approved as earlier indicated in the COG report.
The Bureau of the Association of African Central Banks
(AACB), held its 1st Ordinary Meeting of 2016 in Dakar,
Senegal, at the Headquarters of the Banque Centrale des
Etats de l'Afrique de I'Ouest (BCEAO) from March 1 to 3, 2016.
The Bureau:

Authorised the AACB Secretariat to submit the project
proposal aimed at enhancing information exchange
and collaboration on cross-border banking to the
relevant AACB technical groups for comments and
onward submission to the Financial Sector Reform and
Strengthening Initiative (FIRST) of the World Bank;


Approved that the African Caucus be encouraged to
reflect thoroughly on the allocation of a possible
additional seat to Africa within the IMF reform
framework.
Finally, the 9th Joint Annual Meetings of the African Union
Specialized Technical Committee on Finance, Monetary
Affairs, Economic Planning and Integration and the Economic
Commission for Africa Conference of African Ministers of
Finance, Planning and Economic Development was held in
Addis Ababa, Ethiopia from March 31 to April 5, 2016 with the
theme “Towards an Integrated and Coherent Approach to
Implementation, Monitoring and Evaluation of Agenda 2063
and the SDGs”. The meeting agreed to:

focus its commitment on the Addis Ababa Action
Agenda to establish an infrastructure platform aimed at
coordinating investments in infrastructure; developing a
technology
facilitation
mechanism
to
support
innovation, science and technology; strengthening
international cooperation on tax matters to stem the


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tide
of
illicit
financial
outflows;
and
improving
capacities for domestic resource mobilization;


Recognize the key role of regional integration in the
implementation of Agenda 2063 and the 2030 Agenda
for Sustainable Development. The meeting called on
the United Nations to continue its support for Africa’s
transformative agenda by aligning itself with, and
supporting the priorities of the African Union, in
particular Africa’s aspirations for a continental free
trade agreement, regional integration and trade,
industrialization and the related goals of Agenda 2063,
including
the
Programme
for
Infrastructure
Development in Africa, the Comprehensive Africa
Agriculture Development Programme, the Science,
Technology and Innovation Strategy for Africa and the
Action Plan for the Accelerated Industrial Development
of Africa;


Encourage institutions to develop a common platform
to follow-up review of progress on Agenda 2063 and
the 2030 Agenda, such as the African Regional Forum
for Sustainable Development.


Promote peace and security and combating terrorism
which are critical for Africa to achieve the desired
development. It, therefore, invited member States to
joined hands together to ensure that peace and
security are upheld in Africa and across the world.


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APPENDIX TABLES


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Table A1: Money and Credit Aggregates


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.


Dec-14
Mar-15
Jun-15
Sep-15
Dec-15
Mar-16
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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Table A2: Money and Credit Aggregates (Growth Rates)
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
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


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.


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Table A3: Federal Government Fiscal Operations (N billion)
Q1-14
Q2-14
Q3-14
Q4-14
Q1-15
Q2-15
Q3-15
Q4-15
Q1-16
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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