28 November 2014, Sweetcrude, Lagos – Local and international financial market products and services update.
NIGERIA: Diezani Alison-Madueke will succeed Libya’s Abdourhman Ataher Al-Ahirish as OPEC’s President next year, according to a delegate at the group, who asked not to be identified in line with policy.
Alison-Madueke is Petroleum Minister for Nigeria, Africa’s largest oil producer. She was proposed in June as a candidate for Secretary-General of the Organization of Petroleum Exporting Countries, two people with direct knowledge of the matter said. That role is currently held by Libya’s Abdalla El-Badri. The position of president is normally held for one year at a time.
COMMODITIES: Brent fell below $75 a barrel for the first time since September 2010 after OPEC left production limits unchanged at its meeting in Vienna.Crude collapsed into a bear market last month amid the highest U.S. output in three decades and signs of slowing global demand growth.
EUROPE: Mario Draghi said the European Central Bank is open to buying a wide variety of assets for further stimulus as German and Spanish inflation data highlighted the struggle to revive the euro-area economy. If current measures aren’t enough, the Governing Council is “unanimous in its commitment to use other unconventional instruments,” the ECB president said at the University of Helsinki on Thursday.
CHINA: China’s central bank refrained from selling repurchase agreements for the first time since July, loosening monetary policy further as a report showed industrial companies’ profits fell by the most in two years.
The People’s Bank of China didn’t conduct any open-market operations in Thursday’s auction window, after cutting interest rates last week for the first time since 2012. It last suspended sales of repos, which drain funds from the banking system, in the week of July 21 as initial public offerings boosted cash demand. Guotai Junan Securities Co. estimated such share sales tied up 1.6 trillion yuan ($261 billion) this week, while maturing repos injected a net 35 billion yuan.
FX: Stronger close for spot yesterday, spurred by another round of CB intervention. Market had traded relatively calm for most of the day as Wednesday’s RDAS result had an instant effect on sentiments regarding the pair. After trading sub 177 for most part of the day, late pressure turned out to be short-lived as CB’s presence ensured a 177.68 cap for the day, inspiring over 4 big fig intraday gains, trading a 173.80 low and closing just shy of 175. The CBN’s decent work in curbing the pressure on the pair is likely to be tested in the short term as OPEC’s decision not to cut production to support falling oil price had Brent testing sub $72/bbl late yesterday.
FIXED INCOME: Yields continued to struggle to find a level reflective of recent monetary policies as the tone in the secondary market proved strong. Highlight for yesterday was the OMO auction printing at 13% discount (13.86% yield) only NGN6bn sold with bid/cover at 8.8X. OMO auction result shows market hunger for higher yields and this should definitely have some impact at today’s trading.
Macro economic Indicators
Inflation rate (YoY) for Oct. 2014 8.10%
Monetary Policy Rate current 13.00%
FX Reserves (Bn $) as at November 25 2014 36.978
Money Market Highlights
NIBOR (%)
O/N 17.4583
30 Day 14.5520
90 Day 14.8578
180 Day 15.5675
LIBOR (%)
USD 1 Month 0.1550
USD 2 Months 0.2010
USD 3 Months 0.2336
USD 6 Months 0.3264
USD 12 Months 0.5646
Benchmark Yields
Tenor Maturity Yield (%)
91d 12-Feb-15 13.24
182d 07-May-15 12.67
364d 03-Sep-15 12.62
2y 16-Aug-16 12.70
3y 27-Apr-17 13.07
5y 29-Jun-19 13.23
Indicative Currency Exchange Rates
Bid Offer
USDNGN 174.65 175.35
EURUSD 1.2338 1.254
GBPUSD 1.5584 1.5786
USDJPY 118.22 118.25
USDCHF 0.96155 0.9717
GBPEUR 1.2508 1.2712
USDZAR 10.9112 11.1146
JPYNGN 147.9497 148.0503
CHFNGN 180.21 181.90
EURNGN 217.01 218.37
GBPNGN 273.79 275.18
ZARNGN 14.90 16.83