Financial market products & services updaate

*Financial markets.

*Financial markets.

11 November 2015, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: Ahead of today’s inauguration of the Federal Executive Council, FEC, where ministers will be sworn-in, President Muhammadu Buhari yesterday approved the appointment of 18 new permanent secretaries in the Federal Civil Service, some of whom were recruited from the private sector signaling a departure from the past when directors in the civil service were promoted to the post of permanent secretaries.
Key among the appointments included Mr. Louis Edozien and Dr. Mahmoud Isa-Dutse, two professionals with proven track records in the private sector before venturing into the public sector.
Edozien, who was deployed to the Federal Ministry of Power, was before his appointment the Executive Director, Engineering & Technical of the Niger Delta Power Holding Company, NDPHC, where he was responsible for the technical and project management of the federal government’s $8 billion investment in the National Integrated Power Projects, NIPPs.

FIXED INCOME: After another aggressive start in the Fixed Income space yesterday. The drop in bond yields slowed by about midday as ‘some’ profit taking emerged. Focus is on the bond auction today which will set levels. Expectation is for both papers (5 and 10 year) to cut in the low 10% and mid 10% respectively. In T-bills, it’s been the same story and trend. The momentum equally catching up with the new one year bill (3 Nov 16 closing at 7% yield) even though it is not free to trade. Entire fixed income space looking very expensive with lots of moving parts.

FX: The CB maintained the Special auction rate at 196.98 yesterday after the Naira appreciated by 2kobo on Monday. Gross FX reserves on a 30 day moving average now at $30.308bn (5th Nov 2015) from $30.192 as at 30 Oct 2015.

COMMODITIES: OPEC’s latest challenge to U.S. shale oil producers would be about two miles long, lined end to end, and weigh almost 3 million metric tons. It’s due to reach American ports this month.
Iraq, the fastest-growing producer within the 12-nation group, loaded as many as 10 tankers in the past several weeks to deliver crude to U.S. ports in November, ship-tracking and charters compiled by Bloomberg show. Assuming they arrive as scheduled, the 19 million barrels being hauled would mark the biggest monthly influx from Iraq since June 2012, according to Energy Information Administration figures.

CHINA: China’s industrial output matched the weakest gain since the global credit crisis last month, while retail sales accelerated, underscoring a shift in the economy toward greater reliance on consumer spending as old growth engines falter.
The good news is that signs of vibrancy in China’s swelling urban middle class abound: sales at retailers climbed by the most this year, and that was before Wednesday’s Singles Day — a record shopping extravaganza championed by Alibaba Group Holding Ltd.

U.K: After a summer of swings, British stocks are taking a breather as uncertainty over the timing of U.S. and U.K. interest-rate increases has left investors wary of big bets.
The FTSE 100 Index has been trading in a tight range for the past month, with a measure of volatility falling to its lowest level since May. Even as Friday’s U.S. jobs report increased expectations for a Federal Reserve rate increase this year, questions arose about when the Bank of England will make its move.
BOE governor Mark Carney signaled last week the U.K. needs record-low interest rates for longer as a slowdown in emerging-market economies could damage the nation’s recovery.

Macro Economic Indicators
Inflation rate (YoY) for Nov., 2014                   9.40%
Monetary Policy Rate current                          13.00%
FX Reserve (Bn $) as at January 09 2015     30.308

Money Market Highlights
O/N                                 01.0000
30 Days                          12.9596                                                                                   90 Days                          14.3747
180 Days                        16.1227

USD 1 Month                  0.1970
USD 2 Months                0.2725
USD 3 Months                0.3556
USD 6 Months                0.5950                                                                                   USD 12 Months              0.9338

Benchmark Yields
Tenor     Maturity     Yield (%)
91d           11-Feb-16          02.62
182d         05-May-16        03.69
364d         20-Oct-16         04.46
2yr            31-Aug-17         07.99
3yr            30-May-18        08.60
5yr            13-Feb-20         09.95

Indicative Currency Exchange Rates
                         Bid           Offer
USDNG         197.50         199.48
EURUSD       1.0644        1.0846
GBPUSD       1.5052         1.5264
USDJPY        122.96         122.99
USDCHF       0.99885      1.0090
GBPEUR       1.4009          1.4214
USDZAR      14.0931        14.2979
JPYNGN      161.8497      161.9503
CHFNGN       204.99       206.68
EURNGN       217.24        219.60
GBPNGN        309.40      310.79
ZARNGN          14.69         16.61

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