14 June 2017, Sweetcrude, Houston — The local and international financial market products and services update.
NIGERIA: Twenty-four days after the National Assembly transmitted the 2017 budget to the executive, acting President Yemi Osinbajo Monday finally signed the bill into law, with a resolve by the executive and legislature that the former would send a virement request to the National Assembly for the restoration of the budget alterations to the original document presented to the lawmakers by President Muhammadu Buhari last December.
The budget, which was signed in a fully packed auditorium in the Presidential Villa, Abuja, was witnessed by Senate President Bukola Saraki, Speaker of the House of Representatives Yakubu Dogara, Deputy Senate President Ike Ekweremadu, Deputy Speaker Yusuf Lasun, and the Chief of Staff to the President Abba Kyari.
FX: Some bit of liquidity continue to flow in the Market as the reported volume for I & E window yesterday was circa $133m. The CB also announced a wholesale auction yesterday for $100m and Tenor not exceeding 60days.
FIXED INCOME: Bearish tone to start the week. The Bill market sold off as more naira liquidity leaves to fund yesterday’s FX auction.
Bond market also sold off as there was little or no buy side interest and the auction draws closer. O/N closed at 100%. Average yield on bills now 20.52% (+17bps) and bonds 16.15% (+4bps). Only N5.3bn of 353-day bills was sold at 22.68% yield.
U.K.: U.K. inflation resumed its upward march last month, accelerating more than forecast to the fastest pace in four years.
An increase in prices for computer games, laptops and package holidays — partly reflecting the impact of the weaker pound — lifted the inflation rate to 2.9% the highest since June 2013. Economists had forecast that it would remain at 2.7%. Core inflation, which excludes food and energy, also unexpectedly quickened in May, according to the Office for National Statistics. It reached 2.6%, the highest since November 2012.
The price pickup means additional pressure on households, who aren’t seeing their wages keep pace. Bank of England Governor Mark Carney expects inflation to keep accelerating this year before falling back slightly from 2018.
U.S.: The Trump administration laid out its highly anticipated plan for overhauling bank rules, calling on the government to ease, though not eliminate, many of the strictures that were imposed on Wall Street after the financial crisis.
The changes, outlined in a report released Monday evening by the Treasury Department, urge federal agencies to re-write scores of regulations that bankers have frequently complained about in the seven years since the passage of the Dodd-Frank Act. They include adjusting the annual stress tests that assess whether lenders can endure economic downturns, loosening some trading rules and paring back the powers of the watchdog that polices consumer finance.
COMMODITIES: Oil held gains near $46 a barrel before U.S. government data forecast to show crude stockpiles resumed declines after an unexpected rise.
Futures climbed 0.2% in New York after advancing 1 percent in the previous two sessions. Inventories are forecast to have slid by 2.25 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report Wednesday. Crude stockpiles expanded for the first time in nine weeks through June 2. Output at major U.S. shale plays will reach a record in July, according to the EIA.
Macro Economic Indicators
Inflation rate (Y-o-Y) for April 2017 17.24%
Monetary Policy Rate current 14.00%
FX Reserves (Bn $) as at June 08, 2017, 30.283
Money Market Highlights
30 Day 20.6373
90 Day 22.4558
180 Day 24.4769
USD 1 Month 1.12711
USD 2 Months 1.17278
USD 3 Months 1.23644
USD 6 Months 1.41683
USD 12 Months 1.72400
Tenor Maturity Yield (%)
91d 14-Sep-17 18.33
182d 14-Dec-17 20.23
364d 24-May-18 22.47
2y 29-Jun-19 16.42
3y 17-May-20 16.33
5y 27-Jan-22 16.02
Indicative Currency Exchange Rates
USDNGN 314.50 315.00
EURUSD 1.1113 1.1315
GBPUSD 1.2601 1.2803
USDJPY 110.61 110.19
GBPEUR 1.1226 1.1430
USDZAR 12.7080 12.9114
EURNGN 351.71 353.07
GBPNGN 398.48 399.88