12 May 2017, Sweetcrude, Houston — The Local and international financial market products and services update.
NIGERIA: The National Assembly’s budget was increased by N10 billion to N125 billion, from the N115 billion proposed by the executive.
Also, the legislature passed the 2017 Appropriation Bill for the year, with an increment of N143 billion to N7.441 trillion, from the executive’s proposal of N7.298, five months after President Muhammadu Buhari submitted the federal government’s spending bill.
Under its budget, N85.8 billion was assigned to total overhead costs, N23.7 billion for personnel costs and N14.9 billion for capital projects.
FX: I/E FX window opened higher yesterday, +0.23% from Wednesday. DMBs remain pure intermediaries in this window matching buyers and sellers in the markets. CBN also provided liquidity yesterday of $1.5m within the range of $/NGN 305.10 -305.60.
FIXED INCOME: Bond yields raced south, reacting to Wednesday’s bond auction results. On average, yields are down 20bps led by the Mar 2027s. Mar 2037s traded at 16.10% after printing at 16.299% as those who lost out covered. Next supply is far away and with real money and fund managers long cash, we could see some more demand for bonds. A bit of sideways trading in bills with the overall day on day changes mostly flat.
U.S: The U.S. and China reached an agreement to promote shipments of American natural gas and beef that Commerce Secretary Wilbur Ross said was part of a broader effort to begin reshaping the trade relationship between the world’s two largest economies.
The agreement covers 10 areas where negotiators from the two sides have reached consensus, including agricultural trade and market access for financial services. By mid-July, U.S. beef producers will have broader access to Chinese markets, while America will move forward on allowing the import of cooked poultry from China, according to a joint statement announcing the deal.
The statement didn’t appear to change access for Chinese companies to U.S. natural gas exports but welcomed China to receive shipments and engage in long-term supply contracts with American suppliers.
U.K: The Bank of England is taking it for granted that we’ll see an orderly Brexit. Investors aren’t as confident.
While Governor Mark Carney said the U.K. central bank may have to raise rates sooner than markets are expecting, he also said that’s based on new forecasts that presume a “smooth” adjustment to the new relationship with the European Union. Traders questioned the likelihood of such an outlook and sent the pound down.
COMMODITIES: When Khalid Al-Falih arrived at Davos in late January, the Saudi oil minister was exultant. The output cuts he’d painstakingly arranged with fellow OPEC states and Russia were working so well, he said, they could probably be phased out by June.
Almost five months later, U.S. production is rising faster than anyone predicted and his plan has been shredded. Last week, Al-Falih told his fellow ministers more was needed, according to people briefed on the talks, asking not to be named because the conversations are private.
Macro Economic Indicators
Inflation rate (Y-o-Y) for March 2017 17.26%
Monetary Policy Rate current 14.00%
FX Reserves (Bn $) as at May 09, 2017 30.928
Money Market Highlights
30 Day 19.1146
90 Day 21.4356
180 Day 23.4496
USD 1 Month 0.98856
USD 2 Months 1.07028
USD 3 Months 1.18094
USD 6 Months 1.44211
USD 12 Months 1.72400
Tenor Maturity Yield (%)
91d 10-Aug-17 19.12
182d 09-Nov-17 19.77
364d 03-May-18 22.55
2y 12-Apr-19 17.28
3y 13-Feb-20 16.28
5y 27-Jan-22 16.09
Indicative Currency Exchange Rates
USDNGN 314.50 315.00
EURUSD 1.0769 1.0972
GBPUSD 1.2753 1.2955
USDJPY 113.61 113.64
USDCHF 1.00245 1.0127
GBPEUR 1.1723 1.1927
USDZAR 13.3500 13.5534
JPYNGN 2.7197 2.8203
CHFNGN 312.07 313.76