The Nigerian economy recorded an average performance in the 2nd quarter when compared with the 1st quarter. This can be seen from the following:

• Inflation Rate: Available data from CBN showed that the rate of inflation increased from 12.5% in March 2005 to 12.7% in June 2005. The increase in inflation was attributed largely to increase in liquidity in the system coupled with increase in the prices of staple foods.
  
• Interest Rate: Banks deposit and lending rates (according to CBN) declined generally in June 2005. However the spread between the weighted average deposit and lending rates remained high and got widened from 10.47% in March 2005 to 11.35% in June 2005. Survey on interest rate carried out by the Association revealed that lending rate reduced from an average of 26% recorded in the first quarter to about 20.6% in the second quarter.
  
• Exchange rate: Relative stability was recorded in the exchange rate of Naira to US$ dollar in June 2005. The weighted average exchange rate of the Naira to US$ dollar appreciated from N132.86 in March 2005 to N132.89 in June 2005 (0.02% rise).
  
• External Reserves: Nigeria gross external reserves rose from US$ 21.81 billion recorded in March 2005 to US$24.37 billion in June 2005 indicating an increase of 10.5%. The rise has been buoyed by receipts from oil whose prices have remained far higher than the US$30 per barrel benchmark announced in the 2005 Federal Government Appropriation Bill.
  
• Monetary and Credit Developments: Data from CBN indicated an increase in monetary aggregates in June 2005. Broad Money Supply (M2) increased from 9.0% in March 2005 to 20.2% in June 2005, while narrow money supply (M1) increased from 11.1% in March 2005 to 19.6% in June 2005. The growth in the monetary aggregates had already exceeded the planned targets of 11.38% and 15% for fiscal 2005 for M1 and M2 respectively.
  
• Aggregate Banking Credit: In the first six months of the year, aggregate bank credit to the domestic economy grew by 26.1% compared with the target growth of 23.38% for fiscal 2005.
  
• Banking Credit to the Federal Government increased to N714.8 billion in June 2005 as against N497.1 billion in March 2005. Similarly, credit to the Private Sector rose from N1,831.6 billion in June 2005 as against N1,636.6 billion in March 2005.
  
• Currency-in-Circulation:
  Currency-in-circulation reduced from N512.8 billion recorded in March 2005 to N493.4 billion in June 2005 indicating a reduction of 3.8% over the March figure. The reduction recorded within the second quarter was traced by CBN to the decline in currency outside the banking system.
  
• Deposits at the CBN:
• Manufacturing Capacity Utilization increased from 45.33% recorded in March 2005 to 52.17% in June 2005 as against 51.3% recorded in June 2004 (for Lagos Zone – Ikeja, Apapa and Ogun State). The increase in Capacity Utilization within this period has been attributed to the:
  - continued ban on some imported products with enough local capacity
  - slight improvement on energy supply
  - implementation of the newly revised industrial incentives
  
• Oil: Nigeria’s crude oil production was estimated as 2.50 million per day in June 2005 as against 2.32 million per day recorded in March 2005.