Financial market products & services update

*Financial markets.

*Financial markets.

04 December 2015, Sweetcrude, Houston – Local and international financial market products and services update.

NIGERIA: Nigeria plans to raise the portion of local manufacturing in the automotive industry to 80 percent by 2023 as Africa’s most populous country seeks to cut imports and diversify the economy away from oil, the industry regulator said. Nigeria plans to assemble 500,000 vehicles per year over the next five years, compared with 10,000 units in 2014, after awarding 36 companies a production license. Global automakers now building capacity include Japanese companies Honda Motor Co. and Nissan Motor Co., Ford Motor Co. of the U.S. and Hyundai Motor Co. of South Korea, as well as local carmakers.

CHINA: The cost of borrowing yuan in Hong Kong slumped on speculation its ascent to a two-month high deterred Chinese banks from accessing the currency in the interbank market. The overnight Hong Kong Interbank offered rate tumbled 355 basis points, the most since Aug. 26, to 4.78 percent on Friday, according to a fixing by the Treasury Markets Association. The gauge surged to a two-month high of 8.33 percent on Thursday. The People’s Bank of China has asked some onshore banks to stop offering cross-border financing to offshore lenders and ordered a halt to borrowing from the mainland through bond repurchases.

EURO: The euro slipped back against the dollar after its biggest one-day jump since 2009 as investors shifted their attention to a U.S. payrolls report Friday that may boost the likelihood of the Federal Reserve’s first rate increase since 2006 this month. The single currency fell against all but five of its 31 major peers. It surged 3.1 percent versus the dollar Thursday as the European Central Bank’s decision to extend its quantitative-easing plan to at least March 2017 and keep the pace of monthly asset buying steady at 60 billion euros ($66 billion) fell short of some analysts’ forecasts.

FX: The CB Special auction rate was 197.00 as at yesterday.

FIXED INCOME: The result of Primary Market Auction put more selling pressure in the secondary market. The Stop rates closed at much higher levels than market was trading and this led to market selling off existing position. Bonds on the other hand traded firmer, the 2017s and 2034s saw more interest in the market. Activities are still driven by local market. Average T-bill yield is now at 3.85% and average bond yield now at 10.47%. O/N closed at 1% with money market liquidity at N607bn”.

COMMODITIES: Brent crude advanced for a second day, paring a weekly loss as ministers from the Organization of Petroleum Exporting Countries prepared to meet in Vienna to decide output policy. Saudi Arabia held its line at informal discussions Thursday, insisting big non-member producers such as Russia would have to join any output cuts by OPEC, according to a person with knowledge of the talks. A report that the kingdom may propose a supply reduction is “baseless,” a Saudi official said. Brent climbed 29cents to $44.13/bbl.

Macro Economic Indicators
Inflation rate (Y-o-Y) for October. 2015               9.30%
Monetary Policy Rate current                                11.00%
FX Reserves (Bn $) as at December 12, 2015     29.123

Money Market Highlights

O/N                                0.9950
30 Day                           9.4618
90 Day                          11.0551
180 Day                        12.6214
USD 1 Month               0.2686
USD 2 Months             0.3535
USD 3 Months             0.4520
USD 6 Months             0.6847
USD 12 Months           1.0112

Benchmark Yields
Tenor       Maturity         Yield (%)

91d              3-Mar-16            4.81
182d            2-Jun-16            6.22
364d           20-Oct-16           5.53
2y                27-Apr-17          10.58
3y                29-Jun-19         11.81
5y                13-Feb-20         12.12

Indicative Currency Exchange Rates
                              Bid        Offer
USDNGN          196.00      199.50
EURUSD          1.0837       1.1039
GBPUSD          1.5025        1.5227
USDJPY           122.50        122.53
USDCHF         0.98705     0.9972
GBPEUR         1.3727         1.3931
USDZAR         14.2807      14.4841

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