A Review of the Nigerian Energy Industry

Financial market update

Financial markets22 May 2013, Sweetcrude, Houston – Local and international financial market services update.
NIGERIA: The Central Bank of Nigeria left its benchmark interest rate at a record high for a 10th consecutive meeting to curb inflation in Africa’s biggest oil producer. The Monetary Policy Committee kept the policy rate at 12 percent, Governor Lamido Sanusi told reporters yesterday in the capital, Abuja. The naira has dropped 1.3 percent against the dollar since the beginning of the year, adding to pressure on inflation and limiting the scope policy makers have to lower borrowing costs. Inflation accelerated to 9.1 percent in April from 8.6 percent in the previous month. The bank’s target is to keep inflation under 10 percent.

EUROPE: Stocks in Europe were little changed before European Union leaders meet and U.S. data that may show sales of existing homes climbed to a three-year high in April. The Stoxx Europe 600 Index slipped 0.1 percent to 309.76 at 8:04 a.m. in London. The equity benchmark closed at the highest level since June 2008 yesterday. It has rallied 11 percent this year as central banks maintained stimulus measures.

INDIA: India’s benchmark stock index ended a two-day decline amid optimism overseas inflows into domestic shares will continue after the Bank of Japan maintained its monetary easing plan. The S&P BSE Sensex added 0.2 percent to 20,146.31 at 11:57 a.m. in Mumbai. Monetary easing by central banks from Europe to the U.S. and Japan has stoked inflows into emerging markets including India, with overseas funds buying a net $13.7 billion of the nation’s shares in 2013, a record for the period, data compiled by Bloomberg show.

CHINA: China’s stocks fell for the first time in six days, led by technology shares and power producers, before the release of a preliminary manufacturing index tomorrow. The Shanghai Composite Index dropped 0.1 percent to 2,302.40 at the close.

Bonds – Stable for most of the day on Tuesday with some buying to close on news of possible reduction in issuance in Q3.

Bills – Also a quiet day in the T-bill market on Tuesday. Ahead of the MPC and the bill auction today and with the CBN coming out to offer N100bio in 135day bills selling N94bio at 12.30%

Money Market – OBB and unsecured O/N rates came off to 10.25% yesterday as the FAAC inflow of N272 billion came into the market.

Indicative Currency Exchange Rates
Bid      Offer

EURUSD      1.2941    1.2951
GBPUSD       1.5144    1.5154
USDJPY        102.80   103.20
USDCHF       0.9693   0.9713
GBPEUR       1.1703    1.1713
USDZAR      9.5553    9.6553
USDNGN     157.70    158.45
JPYNGN      1.5340    1.5840
CHFNGN     162.69   166.69
EURNGN     204.08   208.08
GBPNGN      238.82   242.82
ZARNGN      16.50      18.50

West Texas Intermediate crude fell for a second day after industry data showed U.S. inventories rose for a fourth week, the longest run of gains since February. WTI for July delivery fell as much as 67 cents to $95.51 a barrel in electronic trading on the New York Mercantile Exchange and was at $95.83 at 2:31 p.m. Singapore time.

Interest rates
NIBOR (%)                     LIBOR (%)

O/N              10.2500        USD 1 month         0.1962
7 Day            10.5833        USD 2 month         0.2320
30 Day         10.8750        USD 3 month         0.2741
60 Day         11.2083        USD 4 month         0.3171
90 Day         11.4583         USD 6 month        0.4184
USD 12 month      0.6858
Y/Y Consumer Inflation April 2013 :            9.1%
FX Reserves: 17 May 2013 (USD bn)           48.463
MPR                                                                    12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

                             Hi                Low             Close        Prev.Close
USD/NGN   158.35/45      157.95/05     158.20/30    158.30/40

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