A Review of the Nigerian Energy Industry

Financial market update

International News
· AUD:
The Australian dollar recouped heavy early losses on Tuesday as Asian shares bounced from lows, though sentiment was still very fragile amid wild market swings.

· CHF: The Swiss franc surged to an all-time high against the euro on Tuesday as investor’s confidence was shattered by extended falls in share prices, prompting them to flock to safe haven currencies.

· CNY: The yuan pulled back against the dollar on Tuesday as the market grew increasingly wary over the pace of yuan appreciation for the rest of this year, amid global economic and market turmoil after Standard and Poor’s downgraded U.S. long-term credit.

Nigeria News
· Bonds –
Market opened in a panic momentarily on the back of events of late Friday evening with yields dipping early but recovering very quickly. It however still closed lower. The 20yr came off 17bps in the largest move of the day as traders tried to cover repo trades executed with the nationalised banks.

· Bills –
Rates dipped sharply across the curve to open yesterday between 35-50bps as the uncertainty around the nationalisation of the banks on Friday sent panic into the market. Profit taking pushed rates back up towards midday, though the market still closed down on the day.

· Money Market –
Unsecured O/N rates are holding at 7.25% as the system continues to remain liquid with liquidity opening the week just over NGN300bn.

· Interbank/WDAS –
$450m was offered and sold at yesterday’s WDAS auction with demand at $452.79m. CBN intervened at $/NGN152.01.

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