FSL Securities Limited has projected a surge in bond market activities for the year 2024, driven by the Federal Government’s anticipated efforts to address the N9.18 trillion budget deficit and achieve its growth objectives.
Victor Chiazor, Head of Research and Investment at FSL Securities, emphasized the significance of private sector participation in funding the budget deficit, foreseeing sustained activity in the bond market as funds are raised to bridge the deficit gap. He also noted the potential for states with robust revenues to tap into the bond market for infrastructure projects.
Regarding the broader economy, Chiazor anticipates a pickup in economic activities, particularly in the first quarter of 2024, following the appointment of ministers and key government officials. However, he highlighted the challenge posed by Nigeria’s elevated debt levels, which may constrain government spending.
In terms of the equities market, FSL Securities expects a subdued performance compared to 2023, with domestic investors likely dominating trading activity amid reduced interest from foreign investors. The market’s performance will be influenced by factors such as the Central Bank of Nigeria’s policy stance and the financial performance of companies.
Chiazor also discussed the expected dynamics of monetary policy in 2024, suggesting a mixed approach as policymakers monitor unfolding events and decide whether to adopt expansionary or contractionary measures. Overall, while fiscal visibility may improve, economic prospects will be shaped by a combination of fiscal and monetary policies alongside market dynamics.