A Review of the Nigerian Energy Industry

Financial market update

Financial markets02 January 2013, Sweetcrude, Houston – Local and international financial market products and services update.
NIGERIA: Nigeria is to become the 25th largest economy in the world by 2028, second only to Egypt in Africa. This will firmly consolidate the country’s place as the largest economy in Sub-Saharan Africa, the 2013 Centre for Economic and Business Research’s World Economic League Table has revealed. Nigeria’s GDP is estimated to hit $927 billion, $655 billion higher than the current estimate of $272 billion. [BusinessDay]

FX: The market was very volatile on Tuesday with the pair trading at a range of about 200 points. The pair opened at the day’s high and trader’s expectation of CBN intervening forced an initial sell off of USD before rates stabilised at 159 levels. Some demand crept in taking rates back to the 160 levels before CBN finally intervened to push rates down.

BONDS and BILLS: No trading on the 31st of December as the market had wound down for the year.

MONEY MARKET: OBB and ON rates both at 10.25%. Liquidity in the system is in excess of N 400 Billion

COMMODITIES: WTI rose for the first time in three days after an industry report showed crude inventories fell in the U.S, the world’s largest oil consumer. WTI for February delivery rose as much as 40 cents to $98.82 a barrel in electronic trading on the New York Mercantile Exchange and was at $98.79 at 2:09 p.m. Singapore time. It fell 87 cents to $98.42 on Dec. 31.

US: Shares of U.S. financial firms just staged their biggest annual rally since 1997, creating a bonanza for Wall Street employees who received bonuses in deferred stock. The KBW Bank Index of 24 lenders increased 35 percent in 2013, the most in 16 years, and the Standard & Poor’s 500 Capital Markets Index of 13 securities firms and asset managers surged 49 percent, the most on record

CHINA: China’s benchmark money-market rate dropped by the most in a week amid ample cash supply at commercial lenders even as the central bank drained funds. The People’s Bank of China withdrew a net 29 billion Yuan ($4.8 billion) this week in open-market operations after refraining from selling reverse-repurchase contracts, according to traders at primary dealers required to bid at the auctions

Macro Economic Indicators
Inflation rate (yoy) for Nov. 2013         7.9%
Monetary Policy Rate current                12%
FX Reserves (Bn $) as at Dec. 24          43.880

Money Market Highlights

O/N                                          10.6250
7 Day                                        10.8750
30 Day                                     11.1250
60 Day                                     11.3750
90 Day                                     11.7917
USD 1 Month                           0.1677
USD 2 Months                         0.2127
USD 3 Months                         0.2461
USD 6 Months                         0.3480
USD 12 Months                       0.5831

Benchmark Yields
Tenor               Maturity             Yield (%
91 days               27-Mar-14              11.97
182 days             05-Jun-14              11.58
364 days             04-Dec-14              12.36
2 years                23-Apr-15               12.71
4 years                31-Aug-17               12.58
5 years                30-May-18             12.57

Indicative Currency Exchange Rates
Bid        Offer

EURUSD          1.3726      1.3736
GBPUSD           1.6572      1.6582
USDJPY            105.36      105.76
USDCHF           0.8940    0.8960
GBPEUR           1.2071      1.2081
USDZAR           10.5595   10.6595
USDNGN           159.48     160.23
JPYNGN            1.5137       1.5637
CHFNGN           178.39     182.39
EURNGN           218.90     222.90
GBPNGN            264.29    268.29
ZARNGN             15.10        17.10

Hi              Low            Close        Prev.Close
    161.10/20   159.15/25   159.98/08     161.12/22

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