Financial market update

Financial-market17 May 2013, Sweetcrude, Lagos – Local and international financial market services update.
NIGERIA: Nigerian inflation accelerated to 9.1% in April, while the economy expanded 6.6% in the first quarter, the National Bureau of Statistics said. The inflation rate increased from 8.6% in March. Consumer prices will probably remain between 9.00% and 11.00% this year, according to central bank Governor Lamido Sanusi.

UK: The pound fell versus the dollar, extending a weekly decline, as speculation the Federal Reserve may be moving closer to ending stimulus boosted demand for the U.S. currency. The pound fell 0.2 percent to $1.5244 as of 7:50 a.m. London time after declining to $1.5174 on May 15, the least since April 4. It has dropped 0.8 percent this week.

INDIA: India’s rupee fell the most in a week on concern the Federal Reserve will scale back stimulus measures that have contributed to inflows to emerging markets. The rupee declined 0.4 percent to 54.9950 per dollar as of 9:46 a.m. in Mumbai, the biggest drop since May 10, according to data compiled by Bloomberg. The currency fell 0.4 percent this week.

CHINA: Some Chinese investment projects, including those for airports, paper pulp factories and gas fields, will no longer need pre-approval from the nation’s economic planning agency. In all, 117 “approval items” can go ahead without authorization or be approved by local governments, according to a list published by the State Council on May 15. Premier Li Keqiang pledged to reduce the government’s role in the world’s second-biggest economy after a new leadership took over in March.

Bonds – Markets rallied on Thursday on the back of the lower than expected cut offs at auction on Wednesday. Yields dipped from Wednesday’s closing levels in response yesterday, about 36 on the Jun19s, 27bps on the Jan 22s and 11bps on the Apr17s.

Bills – The CBN came out to offer N100 billion in 161 and 175 day bills selling N143billion at 13.30 and 13.35% respectively. Bearish sentiments in the secondary market yesterday surprisingly, rates up about 10bps on the long dated maturities and stable on the shorter dated maturities.

Money Market – OBB and unsecured O/N rates fell about 400bps to 10.25% and 10.50% respectively as a liquidity injection in form of an OMO maturity of about N261 billion hit the system yesterday. The CBN was out to mop up some of this liquidity.

Indicative Currency Exchange Rates
Bid      Offer

EURUSD     1.2874    1.2884
GBPUSD      1.5239    1.5249
USDJPY      102.50    102.90
USDCHF     0.9663   0.9683
GBPEUR     1.1836     1.1846
USDZAR     9.4036   9.5036
USDNGN    157.60    158.35
JPYNGN     1.5376    1.5876
CHFNGN    163.10    167.10
EURNGN    202.89  206.89
GBPNGN     240.17   244.17
ZARNGN     16.76      18.76

West Texas Intermediate crude swung between gains and losses after rising the most in a week. OPEC was forecast
to increase oil exports this month to meet rising demand from Asian refiners. WTI for June delivery was at $95.26 a barrel, up 10 cents, in electronic trading on the New York Mercantile Exchange at 2:12 p.m. Singapore time.

Interest rates
NIBOR (%)                  LIBOR (%)

O/N              10.7500     USD 1 month      0.1982
7 Day            11.2083     USD 2 month      0.2345
30 Day         11.05833   USD 3 month      0.2741
60 Day         11.8333     USD 4 month      0.3166
90 Day         12.1250     USD 6 month      0.4199
USD 12 month     0.6898
Y/Y Consumer Inflation March 2013 :    8.6%
FX Reserves: 15 May 2013 (USD bn)      48.496
MPR 12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

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