04 April 2018, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: The Nigerian Monetary Policy Committee will probably leave interest rates unchanged at its first meeting of the year even though the panel has added five new members since its previous gathering in November. Inflation has been outside the central bank’s 6% to 9% target band for more than two years and exceeds the monetary-policy rate. While easing could boost expansion in West Africa’s largest economy, which contracted in 2016, only two of the 11 economists in a Bloomberg survey said the committee will cut the benchmark interest rate from 14% on Tuesday
FX: Activities in the interbank section remains muted, rate was maintained around $/N 359.00 – 361.00. Last week daily average was $305.17m, 39% higher than the previous week. Also, the CBN conducted its wholesale auction yesterday, offering $100m to the market. CB also allocated FX funds to banks for their invisible and SME transactions.
FIXED INCOME: After the no supply of OMO bills last week, the market was eager for CBN to come into the market yesterday but CBN was mute all day.
FAAC flow was disbursed end of last week, money market liquidity rose to about N400bn yesterday and O/N was closed at 7%.
The rally in the t-bills market gained more momentum because of the aforementioned factors (mostly in November bills), the average yield dropped by 19bps to close at 14.56%.
The bond market also found renewed buy interest following the selloff last week, but the momentum wasn’t in the same quantum as t-bills.
U.K: Prime Minister Theresa May has pledged to tackle the “burning injustice” of the UK’s gender pay gap – the difference between the average earnings of men and women. Dozens of UK businesses still need to submit their gender pay figures ahead of Wednesday’s midnight deadline.
Some 8,870 companies had already done so as of 07:00 BST. About 9,000 firms with more than 250 staff must state the average difference between male and female employees.
Of those that have already published data, 78% pay men more than women, while 13% pay women more. Just 8% said they had no gender pay gap at all, based on the median measure.
CHINA: China will impose additional tariffs of 25% on 106 U.S. goods including soybeans, autos, chemicals, some types of aircraft and corn products, among other agricultural goods, the finance ministry said on Wednesday.
The products targeted by the tariffs were worth $50 billion in 2017, according to a separate statement from the commerce ministry.
Extra tariffs will also be slapped on products such as whiskey, cigars and tobacco, some types of beef, lubricants, and propane and other plastic products, the finance ministry said in its statement.
COMMODITIES: Energy and commodities firms on both sides of the Pacific Ocean once again found themselves having to assess the potential damage from the escalating trade war between the U.S. and China.
In its latest salvo, the U.S. has proposed 25% tariffs on about $50 billion worth of 1,300 different Chinese-made products, from gas turbines to wind-power generating sets to lithium batteries. Coupled with increased import duties for materials like steel and aluminum, President Donald Trump’s trade policy threatens to raise costs across a wide swath of energy and materials producers and processors.
Macro Economic Indicators
Inflation rate (Y-o-Y) for February 2017 14.33%
Monetary Policy Rate current 14.00%
FX Reserves (Moving Avg Bn $) as at March 28, 2018, 46.208
Money Market Highlights
30 Day 14.5466
90 Day 15.4598
180 Day 17.2360
USD 1 Month 1.88313
USD 2 Months 1.99944
USD 3 Months 2.31175
USD 6 Months 2.45380
USD 12 Months 1.72400
Tenor Maturity Yield (%)
91d 05-Jul-18 12.92
182d 04-Oct-18 14.56
364d 14-Mar-19 15.10
2y 13-Feb-20 13.66
3y 15-Jul-21 13.68
5y 27-Jan-22 13.50
Indicative Currency Exchange Rates
USDNGN (I&E) 359.00 360.50
EURUSD 1.2193 1.2395
GBPUSD 1.3979 1.4181
USDJPY 106.16 106.20
GBPEUR 1.1351 1.1555
USDZAR 11.7621 11.9652
EURNGN 441.26 442.62
GBPNGN 505.50 506.90