13 February 2017, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: Nigeria’s economy is projected to have contracted 1.54 percent in 2016, according to a budget ministry document, with Africa’s most populous country mired in its first recession in a quarter of a century. The budget ministry draft, called “Key issues in the Economic Recovery and Growth Plan”, said the recession was also caused by growth dependent on consumption rather than investment and “huge leaks in government resources through corruption and inefficient spending”. The International Monetary Fund has predicted that Nigeria’s economy would shrink 1.8 percent in 2016. Final official figures are due to be released by Nigeria on Feb. 28.
FX: This week, the Naira on the parallel market finally broke the NGN 500 barrier with the weekly range reported between $/NGN 498 – 503 level.
FIXED INCOME: New Eurobond issue set a positive tone in bonds. Bonds strengthened across the entire curve and real money inquiry reappeared in small sizes on the long end. Bill market, on the other hand, felt well offered particularly on the short dates (<50days). Money market conditions worsened on Friday. Money market liquidity expected to also improve next week because of N212bn OMO maturity.
US: Dan Tarullo, the powerful Federal Reserve governor who was a key architect of post-crisis financial reforms, says the principles that President Donald Trump set out for an overhaul of Wall Street regulation are a “perfectly good starting point”. Mr Tarullo, an Obama appointee and scourge of big banks who announced last week that he would step down, told the Financial Times that despite Mr. Trump recently calling the Dodd-Frank reforms a “disaster” it was too early to judge the future of US financial regulation. His comments will give pause to banks and investors that have registered Mr. Trump’s aggressive rhetoric and taken him at this word, fuelling a rally in bank stocks in the past three months in anticipation of the shackles being cast off the largest institutions.
GERMANY: Frank-Walter Steinmeier, the former German foreign minister who was a vocal critic of Donald Trump during the U.S. campaign, was elected as the country’s 12th postwar president. The Social Democrat, who served two stints as foreign minister under Chancellor Angela Merkel, emerged as her governing coalition’s candidate last November as the parties sought to avoid a political spat over the appointment in an election year. With the support of Merkel’s Christian Democratic-led bloc and the Social Democrats in a special assembly on Sunday, Steinmeier was elected in the first round to the mostly ceremonial post. Steinmeier, 61, will succeed Joachim Gauck, 77, the one-time Protestant pastor and political dissident in communist East Germany who opted to stand down after serving a single five-year term. Gauck will remain in office until March 18.
COMMODITIES: Oil prices were stable today on signs that OPEC-led production cuts were reducing global overproduction, although bloated inventories and rising output elsewhere were weighing on markets. Brent crude futures were trading at $56.72 per barrel at 0752 GMT, up 2 cents from their previous close. West Texas Intermediate (WTI) crude futures, were down 2 cents at $53.84 a barrel.
Macro Economic Indicators
Inflation rate (Y-o-Y) for December 2016, 18.55%
Monetary Policy Rate current 14.00%
FX Reserves (Bn $) as at Feb 09, 2017, 28,698
Money Market Highlights
NIBOR (%)
O/N 11.7500
30 Day 16.4468
90 Day 18.5661
180 Day 23.3438
LIBOR (%)
USD 1 Month 0.77167
USD 2 Months 0.83833
USD 3 Months 1.03372
USD 6 Months 1.33794
USD 12 Months 1.72400
Benchmark Yields
Tenor Maturity Yield (%)
91d 11-May-17 13.62
182d 10-Aug-17 18.58
364d 01-Feb-18 21.59
2y 29-Jun-19 16.05
3y 13-Feb-20 16.42
5y 27-Jan-22 16.14
Indicative Currency Exchange Rates
Bid Offer
USDNGN 314.50 315.00
EURUSD 1.0553 1.0755
GBPUSD 1.2434 1.2636
USDJPY 113.58 113.61
USDCHF 0.99745 1.0076
GBPEUR 1.1663 1.1867
USDZAR 13.1919 13.3953
JPYNGN 2.7097 2.8103
CHFNGN 312.37 314.06
EURNGN 338.92 340.28
GBPNGN 404.78 406.18