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Survey Highlights Likely Effects of Higher Inflation Rate on Economy

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  • Survey Highlights Likely Effects of Higher Inflation Rate on Economy

Respondents to a survey conducted by the Central Bank of Nigeria (CBN) believe the economy would end up weaker if prices of goods and services begin to rise faster than they are presently.

The CBN stated this in its “Inflation Attitudes Survey Report,” for the first quarter (Q1) 2018, that was obtained on its website.

The survey was conducted from March 19 – 24, 2018, from a sample size of 2,070 Households that were randomly selected from 207 Enumeration Areas (EAs) across the country, with a response rate of 83.5percent.

According to the report, respondents were asked what would become of the Nigerian economy if prices started to rise faster than they do now.

But the result showed that 54.7 per cent of the respondents believed that the economy would end up weaker as 11.6 per cent stated that it would be stronger; 16.2 per cent of the respondents believed it would make a little difference, while 17.2 per cent stated that they did not know.

“The responses suggest considerable support for price stability, as majority (54.7 per cent) agreed that the economy will end up weaker. This is consistent with the notion that inflation is constrains economic growth.

“When asked how prices have changed over the past 12 months, respondents gave a median answer of 4.7 per cent.

“Of the total respondents, 16.2 per cent thought prices had gone down or not changed, 61.2 per cent felt that prices had risen least three per cent, while 16.9 per cent felt that prices inched up by more than oneper cent, but less than three per cent.

“Those that had no idea were 5.8 per cent. The median expectation of price changes over the next 12 months was that prices would inch up by 2.3 per cent,” it stated.

Furthermore, it showed that from the total responses, 41.1 per cent of the respondents expected prices to rise by at least three per cent over the next 12 months; 14.2 per cent expected prices to increase by more than oneper cent, but less than 3 per cent.

Similarly, 36.9 per cent of the respondents were optimistic that prices over the next 12 months would either go down or remain the same.

“The percentage of respondent households who felt that interest rates had risen in the last 12 months fell by 14.7 points to 31.6 points in the current quarter when compared to 56.3 points attained in Q4, 2017.

“On the other hand, 8.8 per cent of respondents believed that interest rates had fallen, 15.3 per cent of the respondents believed the rates stayed about the same in the last 12 months, while 44.3 per cent of the households had no idea.

“The result revealed that more households perceived that interest on bank loans and savings rose over the past 12 months.

“On the expected change in interest rates on bank loans and savings over the next 12 months, more respondents (26.9 per cent) were of the view that the rates will rise, while 17.5 per cent believed that the rates will fall.

“A net rise value of 9.4 per cent was recorded compared to 6.5 per cent attained in the previous quarter. About 59.6 percent of the respondents either expected no change or had no idea.

“Similarly, the respondents were asked whether it would be best for the Nigerian economy for interest rates to rise or fall,” it added.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

Finance

Nestle Nigeria Approves Final Dividend of N35.50k per 50 Kobo Ordinary Share for 2020

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Nestle

Nestle Nigeria Approves Final Dividend of N35.50k per 50 Kobo Ordinary Share for 2020

Nestle Nigeria, a leading food and beverage company, has declared a final dividend of N35.50k per 50 kobo ordinary share for the year ended December 31, 2020.

The beverage company said N24.50k of the amount declared was from the after-tax profit of 2020 and N5 and N6 were from the after-tax retained earnings of the years ended December 2019 and 2018, respectively.

Nestle Nigeria stated that the amount declared is subject to appropriate withholding tax and approval at the Annual General Meeting of shareholders.

It also noted that payment will be made only to shareholders whose names appear in the Register of Members as at the close of business on 21 May 2021.

Dividends will be paid electronically to shareholders whose names appear on the Register of Members as at 21 May 2021, and who have completed the e-dividend registration and mandated the Registrar to pay their dividends directly into their Bank accounts.

Shareholders who are yet to complete the e-dividend registration are advised to download the Registrar’s E-Dividend Mandate Activation Form, which is also available on their website: www.gtlregistrars.com, complete and submit to the Registrar or their respective Banks.

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Banking Sector

Dennis Olisa Invests N53.6 Million in Zenith Bank

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Executive Director of Zenith Bank Plc Buys 2 Million Shares of Zenith Bank at N53.6 Million

Executive Director of Zenith Bank Plc, Dennis Olisa, has invested a combined N53.58 million in shares of Zenith Bank.

The leading financial institution stated in a disclosure statement filed with the Nigerian Stock Exchange (NSE) on Monday.

Olisa carried out the purchase in two different transactions on February 24, 2021 at the Nigerian Stock Exchange in Lagos, Nigeria.

He purchased 1 million units of Zenith Bank at N26.60 each and another 1 million shares at N26.50 per share.

On aggregate, Olisa purchased 2 million shares of Zenith Bank at N26.79 per share or N53.58 million. See the details below.

Dennis Olisa was appointed as Zenith Bank’s executive director three years ago.

Prior to his appointment, Mr. Olisa was the Chief Inspector at Zenith Bank Plc and served as its Director from March 3, 2017 until March 16, 2017.

He also served as General Manager and Heads of the Energy Oil & Gas Group at Zenith Bank Plc and served as its Deputy General Manager. He served as Head of Internal Control & Audit Group at Zenith Bank Plc

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Finance

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

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Godwin Emefile

Emefiele Pledges Accommodative Monetary Policy to Boost Economic Growth

The Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, has pledged to adopt accommodative monetary policy stance in 2021 in order to support economic growth in the country.

Emefiele, said this on Friday, while speaking at a CBN/Bankers’ Committee’s initiative for economic growth, which is a one-day special summit on the economy by bank chief executive officers.

The theme of the summit is: “How to Overcome the Pitfalls of Recession.”

Nigeria’s economy recently came out of recession, according to the Gross Domestic Product report for fourth quarter 2020 released by the National Bureau of Statistics.

Owing to the slump GDP growth of 0.11 per cent that lifted the economy out of recession, Emefiele said it was imperative that, “we do all we can in 2021 and beyond to ensure that we build on the positive momentum and strengthen our efforts at stimulating growth.”

He expressed optimism that with the discovery and deployment of vaccines worldwide, 2021 would be a year of massive global recovery and Nigeria must not be left out.

“The banks CEOs are here, whether by moral suasion or by force, they will have to participate in this journey. In order to drive and sustain this recovery therefore, we need to sustain the accommodative fiscal and monetary policy measures aimed at improving access to finance for households and businesses.

“Secondly, we must prevent a resurgence in Covid-19 related cases. Thirdly, we must ensure that a significant number of our population is significantly vaccinated and also improve foreign exchange inflows into our country,” he added.

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