Nigerians are bracing for tough months ahead, with many planning to rely on borrowing and depleting their savings to manage their financial obligations amid a challenging economic landscape.
This is according to the Central Bank of Nigeria’s (CBN) July 2024 Household Expectations Survey, which highlights growing consumer pessimism about the nation’s economic trajectory.
The survey, which involved 1,665 households from across Nigeria, reveals a stark decline in consumer confidence, with the overall confidence index for the next three months standing at a negative 9.1 points.
This figure reflects a significant level of anxiety among consumers who anticipate a continued decline in economic conditions and family financial situations.
As a result, many Nigerians expect to either draw down on their savings or incur debt to meet their needs during this period.
The CBN report read: “At -9.1 points, consumers overall confidence was pessimistic for the next three months. The pessimistic outlook is attributed to declining economic conditions and declining family financial situation as consumers opined that they will be drawing down on savings or getting into debt. They, however, anticipate improvement in the total family income as the index stood at 1.6 points.”
In July 2024, the CBN’s survey revealed a deeply pessimistic outlook among Nigerian consumers, as reflected in the Consumer Confidence Index.
The index for the month stood at -41.7 points, highlighting significant concern over the state of the economy. The negative sentiment captured by this index suggests that a majority of households are facing considerable financial pressures, with many anticipating the need to draw down on their savings or incur debt to manage their living expenses.
Looking ahead to August 2024, the outlook remains bleak, although there is a slight improvement in consumer sentiment.
The confidence index for the next month is projected at -21.8 points, indicating that while consumers are still pessimistic about the future, their outlook is marginally less negative compared to July.
This slight uptick suggests that some consumers may be holding out hope for a modest stabilization or improvement in their financial situations.
Despite the overall pessimism, there is a glimmer of hope as consumers express a slightly optimistic outlook for the next six months, with an index of 2.7 points.
This cautious optimism is driven by expectations of an improvement in both the economy and family incomes by early 2025.
The document reports: “Consumers were optimistic in their outlook for January 2025 as the index stood at 2.7 points. This positive outlook was attributed to anticipated improvement in the economy and expectations of improvement in family income in the next six months.”
TheWitness earlier reported that the rising cost of living pushed Nigerians to borrow about N4.82 trillion from banks between January and March this year.
