Financial market products snd services update

*Financial markets.

10 March 2017, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: Nigeria’s total debt rose to 17.36 trillion Naira ($56 billion) as of Dec. 2016 from 12.60 trillion Naira a year earlier, the Debt Management Office said, as the country grappled with its first recession in a quarter of century caused by low oil prices. Africa’s biggest economy expects a budget deficit of 2.36 trillion Naira for 2017, with half of it funded through domestic borrowing. It has been selling bonds and bills this year at yields below rising inflation to curb borrowing cost as it battles to kick-start the economy this year. Foreign bonds and loans stood at $11.40 billion at the end of December, the debt office said on its website – equivalent to about 20 percent of total debt and up from $10.7 billion at the end of 2015. Local debt spiked to 13.88 trillion Naira last year, up from 8.83 trillion Naira in 2015 and is set to rise further.

FX: The FX reserves broke the $30b mark making a 0.16% overnight rise in the 30-day moving average. The current figure according to the CBN website stands at $30.014b [08.03.2017]. Interbank market traded within the range of $/NGN 305.20- 315.
FIXED INCOME: Bond market was quiet at yesterday’s trading session, few trades seen were skewed to the Mar 2036s. The market was generally long on bonds. T-bills market was much more active, there was buying interest at market open but this slowed towards market close. CBN floated 168 and 322 day OMO bills yesterday, selling 6bn and 25bn at 18.00% and 18.60% respectively.

COMMODITIES: Oil traded below $50 a barrel after a surge in U.S. supply erased all gains over the past three months from an OPEC deal to cut output. Brent for May settlement was 4 cents higher at $52.23 a barrel on the London-based ICE Futures Europe exchange. Prices dropped 92 cents, or 1.7 percent, to $52.19 on Thursday, the lowest close since Nov. 30.

CHINA: People’s Bank of China Governor Zhou Xiaochuan said the Yuan’s rate should be relatively stable this year even as rising U.S. interest rates contribute to foreign exchange volatility. Interest rate differentials won’t lead to persistent speculation, and rates will be mainly based on the domestic economy, Zhou said Friday at a rare press conference in Beijing during the annual National People’s Congress sessions. He said China has many monetary policy tools, policy will be prudent and neutral, and falling foreign reserves is “not bad.”

E.U.: The outlook for eurozone growth is “more optimistic”, the head of the European Central Bank (ECB), Mario Draghi, has said. Accordingly, the central bank has raised its economic growth forecasts for this year and next, to 1.8% in 2017 and 1.7% in 2018. That compares with previous forecasts of 1.7% and 1.6% respectively. The comments came as borrowing costs were kept on hold in the 19-nation bloc, despite a pick-up in inflation. It currently stands at 2%, which is slightly above the ECB’s target of just below 2%. The bank also raised its annual inflation forecast for this year and next to 1.8% and 1.7%.

Macro Economic Indicators
Inflation rate (Y-o-Y) for January 2017,     18.72%
Monetary Policy Rate current                       14.00%
FX Reserves (Bn $) as at Mar 08, 2017,     30.014

Money Market Highlights

O/N                               15.3333
30 Day                          17.0332
90 Day                          20.1061
180 Day                        23.1621
USD 1 Month               0.8578
USD 2 Months             0.9322
USD 3 Months             1.1090
USD 6 Months             1.4210
USD 12 Months           1.72400

Benchmark Yields
Tenor         Maturity        Yield (%)

91d                01-Jun-17         14.39
182d             31-Aug-17          19.28
364d             01-Mar-18        22.37
2y                 29-Jun-19         15.67
3y                 13-Feb-20         16.01
5y                 15-Jul-21           16.19

Indicative Currency Exchange Rates
Bid          Offer

USDNGN              313.65        315.30
EURUSD               1.0512        1.0714
GBPUSD               1.2056        1.2258
USDJPY                115.43         115.46
USDCHF               1.00655      1.0167
GBPEUR               1.1352         1.1556
USDZAR               13.2003      13.4037
JPYNGN               2.6797         2.7803
CHFNGN              310.28        311.97
EURNGN             333.36         334.72
GBPNGN              381.96         383.35

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