Credit Rating Outlook for 2024

Credit Rating Outlook for 2024

It is the time of the year when we forecast the Rating Outlook for 2024 for both the domestic and international markets.

Here are our top 6 trends and patterns to watch out for in 2024.

1. The Nigerian real GDP is expected to outperform the 2.4% recorded in 2023, thereby signalling positive tailwinds for the economy.

2. The domestic refining of petroleum products in Nigeria will materialise in 2024, leading to a change in our trade dynamics and easing the pressure on foreign exchange demands.

3. Borrowing $7.8b and €100 by the FGN from multilateral lenders as part of the funding for Budget 2024 should lessen the crowd-out effect on the domestic debt market.

4. The anticipated CBN Banking Sector Consolidation initiative in 2024 will boost foreign capital inflow and activity on the domestic capital market

5. The Central Bank of Nigeria ( CBN) has discontinued the “Intervention Funds.” The use of Bank loans as a funding option has become expensive considering that they are priced around the MPR, which is currently at its peak. The hope of the interest rate coming down in the immediate future is improbable considering the continued inflationary pressure. Operators will therefore continue to seek alternative funding from the Capital market in 2024.

6. The year 2024 is expected to experience a slow pace of rising inflation, a high interest regime, less volatility in the exchange rate, and much more spending across all tiers of government. The domestic debt market will remain very active.


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