Financial market update

17 May 2012, Sweetcrude, Lagos – Local and international financial market update
NIGERIA: The United States of America’s Export-Import Bank will soon increase its credit support for the Nigerian firms operating in the country’s power sector to $2.5 billion (about N63 billion), up from $1.5 billion (N232 billion), earlier promised, the Federal Government said, yesterday. The credit facility from the bank is coming on the heels of a Memorandum of Understanding the bank signed with Nigeria’s Ministry of Power, recently. [Guardian]

EUROPE: The European Central Bank said it will temporarily stop lending to some Greek banks to limit its risk as President Mario Draghi signalled the ECB won’t compromise on key principles to keep Greece in the euro area. The Frankfurt-based ECB said yesterday it will push the responsibility for lending to some Greek financial institutions onto the Greek central bank until they have sufficiently boosted their capital. The move comes after Draghi acknowledged for the first time that Greece could leave the monetary union.

INDIA: India’s rupee fell to a record low as concern debt-stricken Greece will abandon the euro bolstered demand for dollars and curbed bids for emerging-market assets. The rupee declined 1.3 percent to 54.4950 per dollar in Mumbai on Wednesday, according to data compiled by Bloomberg.

Bonds – The rise in CPI to 12.90% was still playing out in the market on Wednesday even though the expected rise in inflation had been priced in by a lot of market participants and as such the sell off slowed yesterday.

Bills – The full effects of the rise in CPI fed into the market yesterday with a sell off also in the bill market up to 100bps on the short end and an average 50bps on the medium term bills. The long end was very stable with demand feeding into the one year bills which bucked the trend

Money Market – OBB and unsecured O/N rates are averaging 14.50% & 15.00% respectively with market down about N62billion

CBN WDAS AUCTION
Offered: 200mio
Sold: 200mio
Marginal rate: 155.70
Weighted: 155.83
No. of banks: 19

FX
Hi             Low            Close       Prev.Close
USD/NGN 158.98/08  158.10/20  158.90/00  157.90/00