28 December 2016, Sweetcrude, Houston — Local and international financial market products and services update.
NIGERIA: The surprise jump in Nigeria’s foreign reserve to $25.36billion and improving oil prices could help bring an end to the country’s multiple exchange rates which have been the subject of criticism by analysts and investors. The reserves rose by $300million in about a week, according to data on the website of the apex bank. Nigeria currently has almost ten Naira –Dollar exchange rates for transactions in its economy, a signal of its dysfunctional foreign exchange (FX) market. Analysts say the multiple exchange rate mechanism is causing a lot of damage and uncertainty to the economy, as well as encouraging round tripping and rent seeking.
FX: Trading remains muted outside of the daily participation of the CB. The range as at Friday last week was $/NGN 304.75- 305.25. The total FX sales by the CBN was estimated to be around $1 billion against total estimated demand of $3 billion.
FIXED INCOME: The mixed tone still persisted in bills as actual figure debited for the FX intervention will not be known till Wednesday. Estimate is for approx. N350bn to leave the money market from the results finally released today.
U.S: Prices of US treasury bonds pulled back Tuesday as investors gird for the latest round of new government round of debt offerings in 2016. Higher stocks and crude oil prices Tuesday reflected investors’ preference for riskier assets, also sapping demand for haven bonds. The yield on the benchmark 10 year Treasury note rose to 2.567% late morning in New York, near the highest level in more than two years according to Trade web, compared with 2.542% Friday. The US treasury was scheduled to sell $26 billion of two-year notes at 1pm, Tuesday, followed by a 34 billion sale of five year notes Wednesday and a $28 billion sale of seven year notes Thursday. A $13 billion sale of two year floating rate notes is also scheduled for Wednesday.
U.K: U.K. house prices may only eke out a modest gain next year as economic growth weakens and a pickup in inflation squeezes consumers, according to Halifax. The mortgage lender sees housing demand easing in 2017, partly as tax changes and stricter underwriting standards restrict buy-to-let investment. London’s underperformance has also been a theme of 2016, with Brexit and an increase in stamp duty weighing on the market. Luxury home prices in some of the most expensive districts are down more than 10% this year, and land values are also dropping. Property website operator Rightmove said this month that the bubble in prime London “continues to deflate,” and it sees prices there declining 5% in 2017.
COMMODITIES: Oil prices edged down on Wednesday in quiet early Asian trading as the market waits to see how OPEC and non-OPEC members carry through on planned supply cuts in the new year. International Brent LCOc1 crude futures were trading down 13 cents, or 0.2%, at $55.96 a barrel at 0312 GMT after closing the previous session up 93 cents. U.S. benchmark West Texas Intermediate crude oil prices CLc1 were down 7 cents at $53.83 per barrel after settling up 88 cents at $53.90 a barrel in the previous session.
Macro Economic Indicators
Inflation rate (Y-o-Y) for November 2016, 18.48%
Monetary Policy Rate current 14.00%
FX Reserves (Bn $) as at Dec 22,2016, 25.361
Money Market Highlights
NIBOR (%)
O/N 23.2250
30 Day 18.7437
90 Day 19.9540
180 Day 23.3693
LIBOR (%)
USD 1 Month 0.76111
USD 2 Months 0.81444
USD 3 Months 0.99706
USD 6 Months 1.31656
USD 12 Months 1.06675
Benchmark Yields
Tenor Maturity Yield (%)
91d 23-Mar-17 12.89
182d 15-Jun-17 19.48
364d 02-Nov-17 21.79
2y 30-May-18 15.78
3y 29-Jun-19 16.08
5y 15-Jul-21 16.02
Indicative Currency Exchange Rates
Bid Offer
USDNGN 313.45 315.10
EURUSD 1.0341 1.0543
GBPUSD 1.3259 1.3461
USDJPY 117.61 117.64
USDCHF 0.96365 0.9738
GBPEUR 1.1750 1.1954
USDZAR 13.8288 14.0322
JPYNGN 3.0497 3.1503
CHFNGN 312.74 314.39
EURNGN 338.92 340.28
GBPNGN 404.78 406.18