Analysts at the Investment Management & Research have predicted troubled global and Nigerian economic outlook for the second half of the year, noting that that it is tantamount to ‘walking a tight rope’.
In the review of the first half and an outlook for the second half, they noted that global growth was expected to strengthen significantly in 2022 against the backdrop of the perceived marginal impact of the omicron variants, abatement in supply chain disruptions and expected deceleration in inflationary pressures.
As such, major economies witnessed a deacceleration in growth, which is expected to linger in the near term given the aforementioned factors.
In Nigeria, they observed the oil sector was ridden with continuous divestment in the upstream sector, pipeline vandalism and leakages, poor pipeline maintenance and oil theft.
Consequently, they expect GDP growth to register at around 2.50% in 2022.
Observing further, they said, “We expect consumer prices to sustain its uptrend in coming months driven by spike in global commodities prices, exchange rate pressure, power outages, PMS scarcity, and rising energy prices.
Contrary to our expectations of rising yields at the beginning of the year, we saw rates trend significantly downwards in Q1 2022, (up slightly in Q2 2022).
They decried the situation in the first half of the year which recorded higher oil price but low reserves conundrum, with the attendant plaquing of the foreign exchange market.
“Looking ahead, our outlook for reserves and the exchange rate remains biased to the downside due to the poor production capacity, low FPI participation due to rising global interest rates and FX scarcity, “ they said.
