Financial market update

12 March 2012, Sweetcrude, Lagos – Local and international financial market update.
NIGERIA: The giants of the manufacturing sector in Nigeria who have been reviewing the cashless plan being promoted by the Central bank of Nigeria have put forward a number of recommendations to the ease the implementation of the scheme in Lagos the commercial capital of the country. The recommendations being made once addressed should allow the policy to truly serve the interest of the Nigerian public according to the Association of Food, Beverage and Tobacco Manufactures.

EUROPE: Following the world’s largest debt restructure of a sovereign state which took place the world’s biggest central banks are less pessimistic about the Euro and the ECB provides unlimited to cash to the region’s financial system. The ECB has assured the markets of it continuing to support the Eurozone nations but are at the same time calling for more stringent management of the public sector spending going forward.

CHINA: China’s economic growth slowed in the first two months of the year with both exports and domestic demand moderating faster than analysts had forecast. The Central Bank possibly may look at easing the cash reserve ratio even further should the regulators feel that the economy risks slowing down further. China in February had the biggest trade deficit last month in at least 22 years.

INDIA: India’s industrial production unexpectedly rose at the fastest pace in seven months in January weathering the highest interest rates since 2008 and a weaker global growth. A history of swings in the data may prevent the report from easing concern that the cost of credit and the impact of Europe’s debt crisis are dimming India’s economic outlook. The central bank which lowered lenders reserve requirements last week and reviews rates on March 15, has signaled readiness to cut borrowing costs as expansion slows and inflation eases.

Bonds – Few trades recorded in the market on Friday with focus on the 4.00% FGN APR2015 which came off 10bps. Interests remain weak at other parts of the curve which traded relatively flat.

Bills – Quiet session to close the week with few trades recorded, slim demand took yields off an average of 10 –


Money Market – OBB and Unsecured rates close the week at 14.00% and 14.50%.

Hi                       Low               Close            Prev.Close
USD/NGN       157.30/40   156.99/09   157.20/30   157.30/40

NIBOR(%)                      LIBOR (%)
O/N             14.4583    USD 1 month              0.2418
7 Day          14.7917    USD 2 month             0.3505
30 Day       15.2083    USD 3 month             0.4736
60 Day       15.6250    USD 6 month             0.7442
90 Day       15.9167     USD 12 month           1.0554
Y/Y Consumer Inflation January 2012 :      12.60%
FX Reserves: 08 March 2012            (USD bn) 34.682
MPR                                                                               12.00%
Source: FMD and CBN

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