28 July 2017, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: The naira yesterday appreciated to N362.29 per dollar in the Investors and Exporters (I&E) window due to a sharp increase in dollar supply. Data from Financial Market Dealers Quote (FMDQ) showed that the volume of dollar traded in the I&E window rose by 757% yesterday to $645.92 million from $75.32 million on Wednesday. As a result, the indicative exchange rate for the window dropped sharply to N362.29 per dollar from N368.6 on Wednesday, translating to N6.31 appreciation for the naira.
However, the naira depreciated by N1 at the parallel market yesterday, as the market exchange rate rose to N365 per dollar at the close of business from N364 per dollar on Wednesday.
FX: Activity between banks have decreased in the I&E window as we believe demand now exceeds supply. Bids were being shown in the $/N 367 – 370.00 range yesterday. Indicative closing level gained 1.71% from the previous day to print at $/N 362.29 and yesterday’s FMDQ report on turnover/range will give more insight on the reason for this appreciation.
FIXED INCOME: Bill yields continued their downward trend while bond market remained mum.
The issue with CBN’s settlement system is becoming a cause for concern as the number of unsettled trades increases. This could affect trading activities in the interim.
U.K: Sentiment among U.K. households dropped this month to match the weakest reading since just after the Brexit vote, led by a sharp drop in confidence in the economy.
The reading of minus 12 in GfK’s consumer-confidence index is down 2 points from the previous month. Excluding the post-referendum dip in July 2016, the index hasn’t been this low since 2013. A gauge of how consumers see the economy progressing fell 5 points to minus 28, while their eagerness to make major purchases also waned.
With inflation outpacing wage growth, real incomes are falling as uncertainty over how the U.K. will leave the European Union further undermines sentiment.
U.S: In a stinging blow to President Donald Trump, U.S. Senate Republicans failed on Friday to dismantle Obamacare, falling short on a major campaign promise and perhaps ending a seven-year quest by their party to gut the healthcare law.
Voting in the early hours, three Republican senators, John McCain, Susan Collins and Lisa Murkowski, crossed party lines to join Democrats in a dramatic 49-to-51 vote to reject a “skinny repeal” bill that would have killed some parts of Obamacare.
“This is clearly a disappointing moment,” Senate Republican leader Mitch McConnell said on an eerily quiet Senate floor right after the vote.
COMMODITIES: Oil headed for its biggest weekly gain in a month as sliding U.S. inventories and signs of stronger demand raise speculation a supply glut in the world’s biggest consumer may ease.
Futures in New York have gained 7% this week, the most since June 30. U.S. crude stockpiles fell to the lowest since January, while gasoline inventories are at the least this year, the Energy Information Administration said Wednesday. The American Petroleum Institute said Thursday the nation’s fuel use in June surged to the highest for that month in a decade.
Macro Economic Indicators
Inflation rate (Y-o-Y) for June 2017 16.10%
Monetary Policy Rate current 14.00%
FX Reserves (Bn $) as at July 26, 2017, 30.717
Money Market Highlights
30 Day 17.4835
90 Day 20.7863
180 Day 22.5750
USD 1 Month 1.23333
USD 2 Months 1.25778
USD 3 Months 1.31389
USD 6 Months 1.45722
USD 12 Months 1.72400
Tenor Maturity Yield (%)
91d 26-Oct-17 19.41
182d 25-Jan-18 19.68
364d 19-Jul-18 22.90
2y 12-Jul-19 16.90
3y 12-Jul-20 16.44
5y 27-Jan-22 16.18
Indicative Currency Exchange Rates
USDNGN 314.50 315.00
EURUSD 1.1601 1.1803
GBPUSD 1.2929 1.3131
USDJPY 111.19 111.22
GBPEUR 1.1075 1.1278
USDZAR 12.9336 13.1372
EURNGN 376.99 378.26
GBPNGN 421.45 422.84