Parthian Securities forecasts inflation rate drop, positive forex policies

• Published date: 24 January 2023
• Publication title: Nigeria - The Nation

Parthian Securities Limited has predicted gradual drop in inflation, favourable forex policies and a peaceful general election expected to raise foreign investors' interest in the economy.

Speaking at the January 2023 edition of their Bears and Bulls Series themed 'An Investor's Guide to Building Wealth on the Nigerian Exchange', Head of Investment Research, Parthian Securities Limited, Oluwaseun Dosunmu, listed low-interest rates, new listing/capital market reforms and strong corporate earnings as some of the factors that would drive market performance in the year.

'We are optimistic that in 2023, the equities market would continue the positive momentum driven largely by the dominance of domestic investors, better corporate earnings and lower interest rates. Favourable FX policies and a peaceful election would likely get foreign investors trooping into the country in 2023,' he said.

He explained that this is the right time to buy stocks as many investors would likely return to the market after the February presidential election, thus pumping the prices of equities.

Dosunmu cautioned that on the downside, continued monetary tightening, election violence and poor earnings of listed equities could trigger a negative outcome. He projected that 2023 will experience a continuous but slower monetary tightening and bullish oil prices, adding that some of the issues that defined economic performance last year would continue in the year but with some moderation.

He reminded investors that true to Parthian Securities' market predictions last year, the Nigerian equities market defied the odds in 2022, posting an upbeat performance despite the risk-off sentiments that rattled the global equities market.

He stated that the global central themes of 2022 were the Russian-Ukraine war, the zero covid policy in China, high crude oil prices, elevated inflation rates and the hawkish stance adopted by most central banks which...