Financial market products & services update

*Financial markets.

*Financial markets.

30 November 2015, Sweetcrude, Houston – Local and international financial market products and services update.
NIGERIA: The net domestic credit of the banking system to the economy grew by 11.1 per cent to N21.4tn at the end of the first half of this year, according to statistics from the Central Bank of Nigeria. The figure, which is contained in the financial stability report for the first half of this year, represents a decline when compared with the growth of 32.6 per cent and 14.8 per cent at the end of the preceding and corresponding period of 2014.

FIXED INCOME: Market was very quiet on Friday and it was sort of an anti-climax to the volatility seen from the previous days. Average t-bill yield now at 2.43% while average bond yield now at 9.77%. W-O-W t-bill yield dropped 221bps and bond dropped 215bps, this was mainly due to the MPC decisions. O/N still at 1% and money market liquidity at N520bn. Market would be anticipating PMA next week, on offer are 91day – 17.85bn, 182day – 18.00bn, 364bn – 93.33bn.

FX: The CB maintained the Special auction rate at 197.00 on Friday.

CHINA: The International Monetary Fund (IMF) is expected to announce on Monday that China’s currency, the Yuan, will join the fund’s group of international basket of reserve currencies. Just the US dollar, the euro, Japan’s yen and the British pound are currently part of this select band. Earlier this month, IMF head Christine Lagarde backed the Yuan’s inclusion. If the decision is made, the Yuan is likely to join the basket next year, experts said. China is the world’s second largest economy behind the US and asked for the Yuan to become a reserve currency last year. Reserve currencies are used by central banks and other financial organisations to help pay down international debt and steady exchange rates. The last change made to the basket was in 2000, when the euro replaced the deutschmark and the franc.

U.K.: The UK economy grew 0.5% between July and September, official figures have confirmed, unchanged from the initial estimate. It is the second estimate for GDP growth from the Office for National Statistics (ONS). It was a slowdown from the 0.7% rate in the second quarter, but still marked the 11th consecutive quarter of growth. A widening trade gap is being blamed for the slowdown, with trade having a record negative effect on GDP. The deficit in the trade balance, the gap between the level of exports and imports, widened from £7.7bn in the second quarter to £14.2bn in the third. Exports increased by 0.9% while imports grew by 5.5%. Overall, the trade gap knocked 1.5 percentage points off GDP, which is the most since records began in 1997.

COMMODITIES: Oil headed for its largest monthly drop since July as Iran signaled the Organization of Petroleum Exporting Countries won’t reduce its production target at a meeting this week. West Texas Intermediate for January delivery was at $41.59 a barrel on the New York Mercantile Exchange, down 12 cents.

Macro Economic Indicators
Inflation rate (Y-o-Y) for October. 2015                9.30%
Monetary Policy Rate current                                13.00%
FX Reserves (Bn $) as at November 26, 2015    30.049

Money Market Highlights

O/N                                0.8767
30 Day                           8.9005
90 Day                         10.6292
180 Day                       12.6056
USD 1 Month              0.2438
USD 2 Months            0.3250
USD 3 Months            0.4142
USD 6 Months            0.6539
USD 12 Months          0.9739

Benchmark Yields
Tenor         Maturity            Yield (%)

91d               18-Feb-16              1.28
182d            26-May-16             3.88
364d           20-Oct-16               3.92
2y                27-Apr-17               7.17
3y                29-Jun-19             10.55
5y               13-Feb-20              10.43

Indicative Currency Exchange Rates
Bid        Offer

USDNGN           196.00     199.50
EURUSD            1.0480     1.0682
GBPUSD            1.4910      1.5112
USDJPY             123.08     123.11
USDCHF           1.02595    1.0361
GBPEUR           1.4085      1.4289
USDZAR          14.2785    14.4819

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