28 November 2017, Sweetcrude, Houston, Texas — The local and international financial market products and services update.
NIGERIA: The total value of capital imported into Nigeria more than doubled in the third quarter to $4.15 billion, after the economy emerged from a recession, the National Bureau of Statistics (NBS) said on Monday. Nigeria’s economy grew in the second quarter, climbing out of its first recession in 25 years, as oil revenues rose. Last year the central bank imposed currency controls to prevent a collapse in the naira, which affected foreign capital inflows. The NBS said capital imports were over $4 billion in the third quarter, the first such quarterly rise since 2015, just before the economy tipped into a recession. The rise was driven by portfolio and other investments, it said in a report.
FX: The week kicked off with the CBN announcing a wholesale auction, offering a total of $100m to the market with tenor not exceeding 60-days. Banks were also advised their FX allocation for invisible and SME transactions, the end-user rate remains at $/N 360. We estimate amount sold to be circa $100m, based on previous allocations.
FIXED INCOME: Quiet start to the week. Bills saw some selling on the short dates with FX refunds not yet in and more strain on liquidity from the OMO sales. Overall, skewed to the sellers even for bonds. 6mth OMO discount rate another 5bps lower (N47.8bn was sold) and still making market cautious. O/N closed at 30%.
GHANA: Ghana’s central bank cut its benchmark interest rate on Monday by 100 basis points to 20 percent, citing a drop in consumer inflation and the possibility of steady economic growth, Governor Ernest Addison said. The major commodity exporter this month raised its 2017 growth forecast to 7.9 percent from 6.3 percent on expected oil production, and 2018 growth is seen at 6.8, marking a turnaround of sorts for an economy that in the previous three years has averaged less than four percent. It has undergone an International Monetary Fund loan programme to reduce its fiscal deficit and public debt and stabilise the volatile local currency.
SOUTH AFRICA: South Africa’s near-term economic growth potential improved in October and November as healthy retail sales data for August indicated a stronger-than-anticipated momentum. This should lift GDP growth in 3Q, due for release on Dec. 5, and may encourage the South African Reserve Bank to halt monetary easing, which began with a quarter-point cut in the key policy rate to 6.75% in July, amid a weaker rand. This reduction will hardly help weak domestic demand, which is likely to weigh on real GDP growth in 2018.
COMMODITIES: Oil extended its decline from the highest level in more than two years before OPEC and its allies meet this week to discuss prolonging their output cuts beyond March. Brent for January settlement slid 16 cents to $63.68 a barrel on the London-based ICE Futures Europe exchange after closing 2 cents lower on Monday.
Macro Economic Indicators
Inflation rate (Y-o-Y) for October 2017 15.91%
Monetary Policy Rate current 14.00%
FX Reserves (Bn $) as at November 23, 2017, 34.491
Money Market Highlights
NIBOR (%)
O/N 34.7500
30 Day 17.2880
90 Day 19.2866
180 Day 21.8118
LIBOR (%)
USD 1 Month 1.33756
USD 2 Months 1.41213
USD 3 Months 1.46763
USD 6 Months 1.65394
USD 12 Months 1.72400
Benchmark Yields
Tenor Maturity Yield (%)
91d 15-Feb-18 16.32
182d 17-May-18 18.94
364d 01-Nov-18 18.47
2y 29-Jun-19 14.50
3y 13-Feb-20 14.69
5y 27-Jan-22 14.47
Indicative Currency Exchange Rates
Bid Offer
USDNGN (I&E) 358.94 360.59
EURUSD 1.1791 1.1993
GBPUSD 1.3225 1.3427
USDJPY 111.27 111.30
GBPEUR 1.1104 1.1308
USDZAR 13.6512 13.8546
EURNGN 427.78 429.15
GBPNGN 479.48 480.87