A Review of the Nigerian Energy Industry

Financial market update

Financial markets17 October 2013, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: Nigeria’s inflation rate declined to 8 percent in September, the lowest level since March 2008, as the harvest season constrained food-price increases, according to the National Bureau of Statistics. Inflation in Africa’s largest oil producer slowed from 8.2 percent in August, the Abuja-based statistics agency said today in an e-mailed statement.

BONDS: A bit more activity seen today than in Friday’s session though rates still closed largely flat across the curve. Yields rose slightly or traded flat across all but the 7yrs, 10yrs and 20yrs bonds which closed at 13.13%, 13.21% and 13.41% respectively. The average bond yield remained unchanged at 13.25%.

BILLS: Mixed trading pattern in the T-bills market on Monday. No Uniform movement in yield across the maturities. The average yield traded flat at 11.57% on Monday. No OMO auction on Monday from the CBN.

MONEY MARKET: OBB and ON rates closed lower on Monday at 10.50%.

US: The U.S. Congress on Wednesday approved an 11th-hour deal to end a partial government shutdown and pull the world’s biggest economy back from the brink of a historic debt default that could have threatened financial calamity. Capping weeks of political brinkmanship that had unnerved global markets, President Obama quickly signed the spending measure, which passed the Senate and House of Representatives after Republicans dropped efforts to use the legislation to force changes in his signature healthcare law.

EUROPE: Greece’s lenders are demanding that it will have to produce an extra 2 billion Euros in savings in 2014 following a Euro group meeting in Luxembourg on Monday. Kathimerini understands that Finance Minister Yannis Stournaras was told he will have to take more measures next year despite the government’s hopes that it would avoid such a move.

CHINA: China faces pressure for faster credit growth because of capital inflows stemming from the Federal Reserve’s decision to hold off from reducing stimulus, the People’s Bank of China said. “The pressure for monetary and credit expansion is still large” as the trade surplus climbs and capital flows in, the central bank said yesterday in a statement on its website, citing the Fed’s “delayed” exit from monetary easing. The statement didn’t mention the standoff among American lawmakers that risks triggering a U.S. default.

COMMODITIES: WTI crude was little changed after rising the most in a week as the U.S. raised its debt ceiling, ending concern of a default by the world’s biggest oil consumer. WTI for November delivery was at $102.22 a barrel in electronic trading on the New York Mercantile Exchange, down 7 cents. The contract gained $1.08 to $102.29 yesterday.

Indicative Currency Exchange Rates
                          Bid         Offer

EURUSD       1.3558        1.3608
GBPUSD       1.5991         1.6041
USDJPY        98.43          98.83
USDCHF       0.9109        0.9139
GBPEUR        1.1795         1.1805
USDZAR        9.8413        9.9913
USDNGN       160.09       160.84
JPYNGN         1.6264       1.6764
CHFNGN        175.75        179.75
EURNGN       217.05        221.05
GBPNGN       256.00       260.00
ZARNGN        16.27          18.27

Commodities
WTI crude was little changed after rising the most in a week as the U.S. raised its debt ceiling, ending concern of a default by the world’s biggest oil consumer. WTI for November delivery was at $102.22 a barrel in electronic trading on the New York Mercantile Exchange, down 7 cents. The contract gained $1.08 to $102.29 yesterday.

Interest rates
NIBOR (%)                    LIBOR (%)
O/N              10.7083        USD 1 month         0.1755
7 Day            11.1667         USD 2 month         0.2163
30 Day         11.4167         USD 3 month         0.2460
60 Day         11.6667        USD 6 month         0.3644
90 Day         11.9167         USD 12 month       0.6296
Y/Y Consumer Inflation September 2013 : 8.0%
FX Reserves: 11 October 2013 (USD bn)    45.096
MPR                                                                    12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market.

Fx
                             Hi             Low           Close         Prev.Close
USD/NGN  
160.50/60   160.00/10  160.09/19    160.10/20

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