#Nigeria the Budget Office put out 2017 fiscal accounts which showed that FY deficit came in at NGN3.8tr (3.3% of nom GDP) and above the 3% fiscal responsibility act. As usual revenues missed thanks to usual over-optimistic non-oil rev assumptions and higher JV payments But interestingly, capex spending came in a record NGN1.44tr (1.3% of GDP and around 66% of target) with overall budget execution at 87% suggesting some credibility in implementation despite the costs driven by higher drawdowns by Works, Power and Housing

Last week, NBS reported a soft GDP growth print of 1.5% y/y weaker than most analysts myself included expected. Main drag stemmed from oil which contracted and agriculture which grew at its slowest pace since 1987 and trade which remained in recession. Telecomms rose 11.5% Telecomms GDP growth is strongly correlated with growth in subscriber numbers (~90%) and the key driver there was a jump in MTN subscribers (+25% y/y). If one holds the MTN number flat from June 2017, Telecomms GDP would likely have grown by 4.4% which puts Q2 2018 GDP at 0.8%

CBN seems to have boxed itself into a corner. Inflation at 11.4% is below long run level of 12%. FX: you have the reserves to deal with anything even better you've converged most segments (NIFEX closed today at N349/$) GDP Growth is weak, credit growth even weaker what to do? Cut MPR? Na we need to impress some people who interpret our policy position via MPR when in actual fact we have cut real policy rate (OMO) down to 12.15% from 18-22% in 2017. But banks are not lending? Try interventions? Banks are bogged down with IFRS 9, low CAR and NPL issues