28 February 2018, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: Nigeria returned to growth in 2017 after suffering its first recession in a generation the previous year, data released from the country’s statistics office showed on Tuesday. The OPEC member’s gross domestic product (GDP) grew by 0.83% in 2017 after shrinking by 1.58% in 2016, which was its first annual contraction in 25 years, according to the National Bureau of Statistics (NBS) data. Africa’s largest economy and its biggest oil producer fell into recession in 2016 largely as a result of low crude prices and militant attacks on energy facilities in the Niger Delta. Crude sales make up two-thirds of government revenue. It returned to growth in the second quarter of 2017 but the recovery has been fragile since it is largely due to higher oil prices. The International Monetary Fund (IMF) said in December that the economy remains vulnerable. “The growth rate still lags far behind where Nigeria should be,” said Razia Khan, chief economist for Africa at Standard Chartered, although she noted that the full-year growth was higher than the 0.7% forecast by her bank.
FX: Flat tone maintained in the I&E window for the second day this week. The market is basically offered and no interbank takers. Players are having to seek out corporate clients interested in taking funds. Yesterday’s turnover, however, shows a 100% improvement from the previous day. The traded range on the day is reported between $/N 358 – 361.25.
FIXED INCOME: Bonds still generally quiet with the few inquiries balanced between buyers and sellers.
The return of the longer tenured OMOs ( >181d ) triggered the bearish sentiments across the bill curve. FAAC allocations which came in late Monday supported the chunky N249.7b OMO sale.
Money market liquidity still closed in excess of N200bn yesterday and O/N rates at 5% close. We expect the OMOs to continue on Thursday.
CHINA: China is opening a new front in its battle against cryptocurrencies, targeting platforms that allow the nation’s investors to trade digital assets on overseas exchanges, people familiar with the matter said.
Regulators are planning to scrutinize the Chinese bank and online-payment accounts of businesses and individuals suspected of facilitating trades on offshore cryptocurrency venues, the people said, asking not to be identified because the information is private. The accounts’ owners could have their assets frozen or be blocked from the domestic financial system, the people said.
U.K: U.K. consumer and business confidence was muted in February as Brexit obscured prospects for economic growth.
GfK said its measure of household sentiment slipped this month, with consumers less willing to splash out and feeling less optimistic about the economy. A separate report on Wednesday by the Recruitment and Employment Confederation showed that confidence in hiring and investment decisions has fallen to the lowest since the referendum to leave the European Union in 2016.
COMMODITIES: Oil is poised for its first monthly decline in six months as a rally at the start of the year fades on growing fears over booming U.S. shale supply.
Futures in New York dropped 0.5% and are down 3.2% in February. An industry report was said to show U.S. oil inventories rose last week, which would be the fourth expansion in five weeks if confirmed in government data. The head of OPEC plans to dine with shale producers in Houston next week at a time when America is pumping at record levels and threatening the group’s efforts to curb a glut.
Macro Economic Indicators
Inflation rate (Y-o-Y) for January 2017 15.13%
Monetary Policy Rate current 14.00%
FX Reserves (Moving Avg Bn $) as at February 21, 2018, 41,816
Money Market Highlights
NIBOR (%)
O/N 5.1875
30 Day 15.3285
90 Day 15.2860
180 Day 17.9983
LIBOR (%)
USD 1 Month 1.64800
USD 2 Months 1.78893
USD 3 Months 1.98419
USD 6 Months 2.20113
USD 12 Months 1.72400
Benchmark Yields
Tenor Maturity Yield (%)
91d 31-May-18 14.08
182d 30-Aug-18 15.42
364d 14-Feb-19 15.43
2y 13-Feb-20 13.88
3y 17-Jan-21 13.73
5y 27-Jan-22 13.56
Indicative Currency Exchange Rates
Bid Offer
USDNGN (I&E) 359.00 360.00
EURUSD 1.2139 1.2341
GBPUSD 1.3806 1.4009
USDJPY 107.00 107.50
GBPEUR 1.1261 1.1465
USDZAR 11.6419 11.8451
EURNGN 439.95 444.82
GBPNGN 499.90 501.29
