Nigeria’s Ratings Risk Downgrade If Its Oil Savings Fall

Nigeria’s credit ratings may be drop if the country raises its proposed oil benchmark price and fails to increase its savings, President Goodluck Jonathan said.

Highlights from market news:

– The lower price is prudent and key to communicating that Nigeria “is managing the economy and thinking of tomorrow,” Jonathan said

– Nigeria will be at increased risk of inflation and currency depreciation if a higher oil price than proposed by Jonathan’s administration is adopted

– The credit rating of sub-Saharan Africa’s second largest economy was raised Nov. 7 one level to BB- by Standard & Poor’s as the nation increased foreign-currency reserves with oil prices staying well above the $72 a barrel price used for this year’s budge

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