A Review of the Nigerian Energy Industry

Financial market update

15 October 2012, Sweetcrude, Lagos – Local and international financial market update.
Nigerian Bonds – Quiet session on Friday, very little intraday movement across the curve and thin activity in general and we look towards the auction this week.

Nigerian Treasury Bills – Also a quiet session in the bill markets, most of the demand here has been soaked up in the primary auction and also by the OMO offerings by the CBN in their attempts to soak up the liquidity

Nigerian Money Market – OBB and unsecured O/N rates are averaging 10.50% & 11.00% to close on Friday.

Nigerian News: The DG of the DMO, announced plans to appoint a government stockbroker charged with the responsibility of overseeing FGN Bonds listed on the floor of the Nigerian Stock Exchange (NSE). According to Nwankwo, the proposed role of the government stockbroker will be different from what it used to be, adding that it is an important appointment that will be renewed periodically. DMO’s Director of Market Development, Patience Oniha, explained that there is need to adequately capture FGN Bonds on the NSE market data base.

EUR: The market continued to push prices higher reaching almost $ 1.3000 before rebounding. The Declient from $ 1.2993 is however not big enough to slam the door to higher levels. To do so the market must pass $ 1.2825. Breaking $ 1.2962 will on the other hand lead to renewed upward pressure and a rise to initially $ 1.3020.

JPY – If the Sept/Oct contracting range is bear triangle well then selling should resume from no later than 78.88 yen ( but preferably before 78.68). A following break of 78.27 will thereafter suggest that the triangle is due for a downside break. Above 78.88 yen it’s back to the drawing board.

GBP: Sterling tracked the euro higher against the dollar though it rise was limited by concern about a weak UK economy and the possibility of more monetary easing from the Bank of England.

Indicative Currency Exchange Rates
                             Bid          Offer
EURUSD           1.2940       1.3000
GBPUSD           1.6050       1.6100
USDJPY            78.10          78.70
USDCHF           0.9300      0.9350
GBPEUR           1.2350        1.2400
USDZAR           8.5000       8.5050
USDNGN          157.00        157.50
JPYNGN           1.9700        2.0300
CHFNGN          166.67        170.67
EURNGN          201.13        206.63
GBPNGN          249.27        256.77
ZARNGN          17.01           19.01


Brent futures slipped to $ 114, falling for a second day due to worries over the worsening outlook for demand growth, although mounting supply concerns over escalating tension in the Middle East kept losses in check.

Interest rates
NIBOR (%)                   LIBOR (%)
O/N            11.4583         USD 1 month             0.21400
7 Day          12.2500        USD 2 month            0.27550
30 Day       13.6667         USD 3 month            0.33425
60 Day       14.0417         USD 4 month            0.42210
90 Day       14.3750         USD 6 month            0.59590
USD 12 month          0.93600
Y/Y Consumer Inflation August 2012 :             11.7%
FX Reserves: 10 October 2012 (USD bn)         41.60
MPR                                                                         12.00%
Source: Reuters Guardian, Bloomberg, Central Bank of Nigeria,  Financial Market Dealers Association Standard Chartered Bank Nigeria.

                             Hi           Low        Close         Prev.Close
USD/NGN  157.35/45  157.15/25   157.30/40   157.15/25

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