A Review of the Nigerian Energy Industry

Financial market products & services update

15 September 2014, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: The Federal Government yesterday concluded an elaborate plan targeted at boosting trade between Nigeria and countries in Asia by 100 per cent in the next 24 months. The fresh Nigeria-Asia trade strategy was fine tuned last weekend by the officials of the Federal Ministry of Industry Trade and Investment, along with Nigeria’s ambassadors across the Asian countries, in a two-day meeting in New Delhi, India. The strategic meeting was the first of its kind in over 50 years aimed at brainstorming on a synergy targeted at further improving the trade and investment ties with the 15 Asian countries. The Minister of Industry, Trade and Investment, Mr. Olusegun Aganga, told journalists at the end of the two-day meeting that the ministry and the ambassadors resolved to work on doubling the volume of trade between Nigeria and Asia to over $80 billion (N13.2trillion) within two years.

Financial markets 1EU: The European Central Bank expects the euro zone will return to modest growth in the third quarter but full year growth will be less than 1 percent, ECB Vice President Vitor Constancio said on Saturday. “We anticipate that after the hiccough of the second quarter, there will be positive growth in the third quarter but that growth in whole year will be below one percent, which is very small,” Constancio told reporters following a meeting of EU finance ministers in Milan. Growth in the 18-nation currency bloc stagnated between April and June.

CHINA: China’s fiscal spending expenditure growth eased to 6.2 percent in August from a year earlier, data from the Ministry of Finance showed, reflecting the government’s efforts to brake spending after a surge in previous months. Spending growth decelerated after a rise of 9.6 percent in July and gains of 26.1 percent and 24.6 percent in June and May respectively. Still, of the total 9.0 trillion Yuan of government spending in the first eight months, money disbursed on public housing projects grew the most, up 28.3 percent from a year ago to 294.5 billion Yuan (47.98 billion US dollar), according to reports.

FIXED INCOME: There was a bit of buying on Friday on the August 2016s. 11.35% seemed like a good level with last auction cutting at 11.123%. Treasury bills were a mixed bag. They opened stronger, then reversed by mid day and overall closing slightly weaker. Liquidity in the system at NGN270billion as at Friday’s open with overnight rates closing at 10.75%.

COMMODITIES: Brent slipped in London. Brent for October settlement slipped 8 cents, or 0.1 percent, to $98 a barrel on the London-based ICE Futures Europe exchange.

Macro Economic Indicators
Inflation rate (YoY) for July. 2014                           8.30%
Monetary Policy Rate current                                   12.00%
FX Reserves (Bn $) as at September 10 2014        39.573

Money Market Highlights

O/N                                11.0833
30 Day                           12.0130
90 Day                           12.8438
180 Day                         13.8080
USD 1 Month                0.1536
USD 2 Months              0.1950
USD 3 Months              0.2346
USD 6 Months              0.3309
USD 12 Months            0.5862

Benchmark Yields
Tenor         Maturity        Yield (%)

91d                11-Dec-14          11.00
182d              05-Mar-15        10.92
364d              03-Sep-15         11.21
2y                   16-Aug-16         11.40
3y                   31-Aug-17          11.50
5y                   29-Jun-19         11.60

Indicative Currency Exchange rates
                         Bid         Offer
USDNGN      162.50       163.20
EURUSD       1.2853       1.3055
GBPUSD       1.6145        1.6687
USDJPY        107.27        107.29
USDCHF       0.9291       0.9393
GBPEUR       1.2440       1.2906
USDZAR     10.9540      11.1580
JPYNGN       1.4677        1.5685
CHFNGN      173.49       175.16
EURNGN      210.27      211.64
GBPNGN      263.87      270.80
ZARNGN      13.81          15.63

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