Financial market products & services update

*Financial markets.

*Financial markets.

18 November 2015, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: Nigeria’s economy might have escaped slipping into recession as the country’s Gross Domestic Product grew by 2.84 per cent year-on-year in real terms in the third quarter of this year. The 2.84 per cent represents an increase of 0.49 percentage points when compared to the 2.35 per cent recorded in the second quarter of this year. The National Bureau of Statistics stated in its GDP report released on Tuesday that in nominal terms, the aggregate economic output for the third quarter stood at N24.313tn at basic prices. The report stated, “In the third quarter of 2015, the nation’s GDP grew by 2.84 per cent year-on-year in real terms. This was higher by 0.49 points from growth recorded in the preceding quarter, yet lower by 3.38 per cent points from the growth recorded in the corresponding quarter of 2014.

FIXED INCOME: A more subdued trading session yesterday, though there was still some selling interest in the market for both bonds and bills. FMDQ instructed market to widen bid-offer spread for bonds to 100 pts and 50pts for bills. This kind of reduced the gapping prices we had seen in the past days. Tbill yields moved up 20bps, while bond yields moved up by 5bps. Average Tbill yield now 4.80% and 11.65% for bonds. O/N still closed at 1%.

FX: The CB appreciated the Special auction rate by 3 kobo to 196.97 yesterday.
EUROPE: The UK’s inflation rate as measured by the Consumer Prices Index remained at -0.1% in October, the Office for National Statistics has said. The news will further dampen expectations of a rise in interest rates any time soon. The Bank of England said earlier this month that the global economy was weakening, depressing inflation risks. Following this report, many economists forecast that rates would not rise until well into next year. The ONS added that the Retail Prices Index, a separate measure that includes housing costs, fell to 0.7% in October from 0.8% in September. This is the lowest RPI rate since November 2009. October marked the first time the Consumer Prices Index has fallen on an annual basis for two months in a row since the index was created in 1997. The price of clothing rose last month, but this was offset by a fall in food, alcohol and tobacco.

CHINA: China’s economy is stabilising, according to business survey figures published today, with the manufacturing and services maintaining their growth rates in November after months of deceleration. World Economics’ sales managers’ index posted a score of 51.6, the same score as in October. Any score above 50 signifies expansion, with higher scores marking faster growth. “The value indicates that Chinese economic activity is growing at a slower rate than in the summer months, but that the rate of growth has now stabilised after the long slowdown,” World Economics said. The SMI is compiled from a range of data on confidence, prices, sales and hiring. The survey also found that only 13.2 per cent of Chinese sales managers believe the value of the Yuan is negatively impacting business, down from 15.2 per cent the previous month.

COMMODITIES: Oil halted its slide near the lowest close in more than two months as U.S. industry data showed crude stockpiles declined in the world’s biggest consumer. West Texas Intermediate for December delivery, which expires Friday, rose as much as 56 cents to $41.23 a barrel on the New York Mercantile Exchange and was at $41.23.

Macro Economic Indicators
Inflation rate (YoY) for Nov., 2014                   9.30%
Monetary Policy Rate current                          13.00%
FX Reserve (Bn $) as at January 09 2015     30.370

Money Market Highlights
O/N                                 0.95830
30 Days                          12.2526                                                                                                   90 Days                          14.1753
180 Days                        15.8233

USD 1 Month                  0.1993
USD 2 Months                0.2820
USD 3 Months                0.3641
USD 6 Months                0.6028                                                                                                 USD 12 Months              0.9324

Benchmark Yields
Tenor     Maturity     Yield (%)
91d           04-Mar-16         06.70
182d         05-May-16        07.83
364d         20-Oct-16         07.30
2yr            27-Aug-17         09.18
3yr            29-Jun-19         12.11
5yr            13-Feb-20         12.17

Indicative Currency Exchange Rates
                         Bid           Offer
USDNG         197.44         198.14
EURUSD       1.0565        1.0767
GBPUSD       1.5105          1.5309
USDJPY        123.30         123.33
USDCHF       0.00885      1.0190
GBPEUR       1.4154          1.4358
USDZAR      14.1456        14.3490
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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