10 April 2018, Sweetcrude, Lagos — The local and international financial market products and services update.
NIGERIA: Nigeria’s President Muhammadu Buhari confirmed on Monday he will seek another term in elections next year, ending months of speculation about his future after bouts of ill health. The 75-year-old said he would seek his party’s presidential ticket to contest elections in February a closed-door meeting of the national executive committee of his All Progressives Congress (APC) party. He flew to Britain for talks with Prime Minister Theresa May a few hours later. The announcement by Buhari, a northern Muslim who became the first opposition candidate to defeat an incumbent at the ballot box, was widely expected although stocks on the Nigerian market fell 1.01% on Monday to a three-month low. “It takes away the concern of an open race which would have fuelled uncertainty,” said a Lagos-based equity sales analyst. The bond market shrugged off the announcement with the 10-year benchmark debt unchanged at 13.64% from its previous session after one trade on Wednesday, traders said.
FX: Naira opened the week on the same tone, with decent liquidity in the $/N 358-360.50 range. Last week’s daily average turnover was $321m, 5% higher compared to the previous week.
Last month data shows that inflows continue to be driven by offshore investors, with 50% accounting for foreign portfolio investors. The window recorded a total of $3.54bn inflows. The weekly wholesale auction was announced yesterday with $100m on the offer, more information should be available on the tenor and range seen at the auction with the results expected latest by Wednesday.
FIXED INCOME: Slow start to the week in both bills and bonds.
With money market still substantially liquid (N500bn+), activity in bills remained tilted to the buyers.
Bill yields contracted by 10bps on average while interest in the bond market is still generally weak. The average yield on bills at 14.25% and bonds 13.59%.
U.K: U.K. household spending grew at the slowest pace in almost two years last month as freezing weather kept shoppers at home.
Annual consumption growth slowed to 2%, the weakest since April 2016, Barclaycard said in a report on Tuesday. Spending in stores fell 1.9% as Britons opted for online shopping as the “Beast from the East” snowstorm engulfed the country. A separate survey by the British Retail Consortium found modest sales growth in a “volatile” March.
E.U: The European Central Bank’s top officials lined up to express cautious confidence in the euro-area economy after a series of reports pointing to a surprisingly weak start to the year while reiterating that they’ll move only slowly toward the end of stimulus.
President Mario Draghi and three of his most-senior colleagues signaled on Monday that while inflation remains too low and a global trade spat poses a new threat, the region’s economic upturn is still solid. The comments come just over two weeks before the Governing Council meets to discuss how and when it might end its bond-buying program.
COMMODITIES: Oil advanced above $64 a barrel after Chinese President Xi Jinping’s conciliatory tone in a closely watched speech raised hopes that U.S.-China trade tensions may ease, lifting global risky assets.
Futures in New York erased earlier losses in the day to rise as much as 1.5% as Xi vowed to open sectors from banking to auto manufacturing, increase imports and lower foreign-ownership limits. That came after U.S. President Donald Trump expressed optimism on reaching a deal with China. Markets from global equities to metals gained on expectations that a trade war between the world’s two largest economies can be averted.
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 April 04, 2018, 46.554
Money Market Highlights
30 Day 14.2523
90 Day 15.0850
180 Day 16.2952
USD 1 Month 1.89713
USD 2 Months 2.02225
USD 3 Months 2.33746
USD 6 Months 2.45380
USD 12 Months 1.72400
Tenor Maturity Yield (%)
91d 12-Jul-18 13.96
182d 04-Oct-18 14.54
364d 14-Mar-19 15.02
2y 13-Feb-20 13.40
3y 15-Jul-21 13.73
5y 27-Jan-22 13.50
Indicative Currency Exchange Rates
USDNGN (I&E) 359.00 360.50
EURUSD 1.2207 1.2405
GBPUSD 1.3908 1.4264
USDJPY 106.99 107.02
GBPEUR 1.1391 1.1595
USDZAR 11.9778 12.2500
EURNGN 440.49 444.86
GBPNGN 504.50 510.90