Financial market update

11 February 2013, Sweetcrude, Lagos – Local and international financial market update.

NIGERIA: In the bid to curtail the federal and state governments’ high propensity to borrow, the Debt Management Office (DMO) has set a limit of N340.73 billion on domestic borrowing for both tiers of government in 2013. The Office also set a $4.35 billion limit on external borrowing in the current year. Regardless of this limit, the federal government has already planned a $1.0 billion Eurobond in 2013.

EUROPE: European stock-index gained as euro- area finance ministers meet to discuss aid to Cyprus and Greece, as a tightening election contest in Italy and a political scandal in Spain threaten to reignite the region’s debt crisis.. Futures on the Euro Stoxx 50 Index, a benchmark for the euro area, rose 0.3 percent to 2,634 at 7:15 a.m. in London.

INDIA: Indian stocks swung between gains and losses. Tata Motors Ltd. advanced, while ITC Ltd. dropped. The BSE India Sensitive Index, or Sensex, traded little changed at 19,474.31 as of 12:31 p.m. in Mumbai, after changing directions at least 16 times.

CHINA: The Chinese government plans to allocate 120 billion yuan (19.11 billion U.S. dollars) to fund local transport infrastructure construction in 2013, the Ministry of Finance has announced. According to the budget target set by the central government, the fund will be allocated from vehicle purchase tax incomes and mainly used to improve highway networks of trunk lines and rural roads.

Bonds – Light sell off on Friday possibly ahead of this week’s auction. Volumes relatively low in trading, very cautious as there is a high possibility of excess demand pulling the auction cut off lower than current secondary levels.

Bills – Bearish on Friday in reaction to the OMO offering from

the Central Bank. N100billion was offered, N116billion was sold in 125day bills at 11.50%.

Money Market – OBB and unsecured O/N rates dipped to 13.25% and 13.50% as the market opened liquid on Friday.

Indicative Currency Exchange Rates
                           Bid             Offer
EURUSD         1.3371           1.3381
GBPUSD         1.5773           1.5783
USDJPY          92.54             92.94
USDCHF         0.9170          0.9190
GBPEUR         1.1794            1.1804
USDZAR         8.8838          8.9838
USDNGN        156.95            157.70
JPYNGN         1.6960           1.7460
CHFNGN         171.16             175.16
EURNGN         209.86         213.86
GBPNGN         247.56          251.56
ZARNGN         17.67             19.67

Brent traded near a nine-month high in London after climbing for a fourth week, the longest streak of gains since July. Brent for March settlement was at $118.73 a barrel, down 17 cents, on the London-based ICE Futures Europe exchange at 5:35 p.m. Sydney time. Brent for March settlement was at $118.73 a barrel, down 17 cents, on the London-based ICE Futures Europe exchange at 5:35 p.m. Sydney time.

Interest rates
NIBOR (%)                  LIBOR (%)

O/N              13.2083     USD 1 month        0.2002
7 Day            13.5417      USD 2 month        0.2475
30 Day         13.8750     USD 3 month        0.2920
60 Day         14.2083     USD 4 month        0.3456
90 Day         14.5000     USD 6 month        0.4654
USD 12 month      0.7660
Y/Y Consumer Inflation December 2012 : 12%
FX Reserves: 02 February 2013 (USD bn) 46.219
MPR                                                                   12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

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