Firms lose confidence in economy, index now down to -66.2%

At the backdrop of the lull brought about by the Coronavirus (COVID-19) lockdowns, Business Confidence Index fell into the negative territory for the first time to -66.2 index points in May, 2020, indicating loss of confidence among business owners across the country.


A report by the Central Bank of Nigeria, CBN, also indicates that confidence would remain low until next month before picking up gradually into October.


This represents decline of 72.6 index points when compared to the positive 6.6 index points recorded in preceding month of March.


The Central Bank of Nigeria (CBN) disclosed this in its Business Expectations Survey (BES) report for May.


But Vanguard analysis showed that the Confidence Index has been on the downward trend since December.


After rising steadily for 11 months from 221.1 index points in February 2019, to 30.3 index points in December 2019, it fell consistently in the first quarter of this year to 6.6 index points in March, indicating decline of 23.7 index points.


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The CBN report showed that the decline worsened in May with respondent firms expressing negative outlook on the volume of total order, credit access, average capacity utilization and financial conditions (working capital).



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The CBN stated: “At -66.2 index points, the overall confidence index (CI) indicated respondents’ pessimism on the overall macro economy in the month of May 2020. Respondents remained pessimistic in their outlook for June with a confidence index of -4.2, however they were optimistic of improvements in July and October 2020 as shown in a greater confidence of the economy, at 16.7 and 49.3 index points, respectively


“The pessimism on the macro economy in the current month was driven by the opinion of respondents from construction (-2.4 points) wholesale/retail trade sectors (-5.6 point), manufacturing (-20.0 points) and Agric/services (-37.7 points). Similarly, the major drivers of the pessimism for next month were construction (-0.3 points), manufacturing (-1.3 points) and agric/services (-2.8 points).


“Further analysis showed that businesses that are export-oriented (-1.2 points), both import- and export-oriented (-9.6 points), import-oriented (-10.0 point) neither import- nor export-oriented (-45.5 points), drove the negative business outlook in May 2020.


“Firms identified insufficient power supply, financial problems, unfavourable economic climate, competition, high interest rate, insufficient demand, unclear economic laws, access to credit, unfavourable political climate and insufficient demand as major factors constraining business activity.


“Respondent firms expect the Naira to depreciate in the current month, next month, next 2 months and appreciate in the next 6 months. Inflation level is expected to rise in the next six months and 12 months, while borrowing rate is expected to rise in the current month, next month, next two months and next six months.”



  1. Reply

    Thanks for this update

  2. Reply

    Thanks for sharing

  3. Reply

    Good article

  4. Reply

    Thanks for the information

  5. Reply

    This very important

  6. Reply

    Nice information

  7. Reply

    If the economy index is depreciating, then things are really getting worse

  8. Reply

    Good update

  9. Reply

    Awesome information thanks for letting us know

  10. Reply


  11. Reply

    Thanks for the update

  12. Profile photo ofItz Kvng Twitch


    Very interesting

  13. Reply

    Not looking good

  14. Profile photo ofOlatunbosun



  15. Reply

    Looks bad

  16. Reply

    Not good

  17. Reply

    Thanks for update

  18. Reply

    Nice article about business

  19. Reply


  20. Reply

    Great news about business

  21. Reply

    We hope for restoration

  22. Reply

    They should try and find solutions to the problem

  23. Reply


  24. Reply

    Good article

  25. Reply

    This means things will get worst

  26. Reply


  27. Reply

    Nice post

  28. Reply

    It is expected

  29. Reply


  30. Reply


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