20 January 2014, Sweetcrude, Houston – Local and international financial market products and services update.
NIGERIA: Latest preliminary numbers emerging from Nigeria’s Gross Domestic Product rebasing exercise are already suggesting that the nation’s economy could show as much as a 65 percent uplift in size, when the long awaited report is released. This would show as much as $432 billion in GDP size, placing Nigeria as the largest economy in Africa. The latest figures are way higher than earlier projections, suggesting that the Nigerian economy has been hugely underestimated over the years.
BONDS: The short end was well bid on Friday, as we saw the August 2016 bond decline further by 16bps to close at 13.00% (now 10bps lower than cut-off at the auction last week). The mid to longer end of the curve was fairly traded, however inching higher by 2 – 5 bps. MPC meeting would set the direction for yields this week.
BILLS: Just when everything appeared to be returning back to normal as the Central bank announced its offering of OMO auction on Friday to mop up liquidity in the already flush system currently above N 1.1 Trillion ($6.9 billion), it came as a surprise that no sale was made even with the healthy N 357 billion subscription. With so much liquidity, the secondary market continued bid, driving yields down even further by an average of 11bps on Friday, across the whole curve. Cautiousness expected as we go into the MPC meeting at the start of this week.
MONEY MARKET: OBB and ON rates dropped to 10.15% and 10.25% respectively.
US: U.S. industrial output rose at its fastest clip in 3-1/2 years in the fourth quarter as factory activity closed out the year on a strong note, a sign of the economy’s brightening prospects. Manufacturing production rose a stronger-than-expected 0.4 percent in December after an out-sized 1.0 percent increase the prior month, a Federal Reserve report on Friday showed. That helped push overall output at the nation’s factories, mines and utilities up 0.3 percent last month.
CHINA: China’s economy grew 7.7 percent in 2013 after easing in the final three months on sagging investment growth, a cool down that some analysts say is a sign of the more sober times ahead as the government wrestles to implement major reforms. With China stepping up its efforts to remake its economy by promoting domestic consumption at the expense of exports and investment, some analysts predicted that the world’s second-largest economy may lose further momentum this year.
COMMODITIES: WTI crude slid from the highest closing price in two weeks after government data showed that industrial output slowed last month in China, the world’s second-biggest oil consumer. WTI for February delivery fell as much as 76 cents to $93.61 a barrel in electronic trading on the New York Mercantile Exchange, and was at $93.68.
Macro Economic Indicators
Inflation rate (yoy) for Dec. 2013 8.0%
Monetary Policy Rate current 12%
FX Reserves (Bn $) as at Jan. 14 43.242
Money Market Highlights
NIBOR (%)
O/N 10.5833
7 Day 10.8333
30 Day 11.0833
60 Day 11.3750
90 Day 11.6667
LIBOR (%)
USD 1 Month 0.1570
USD 2 Months 0.2023
USD 3 Months 0.2366
USD 6 Months 0.3346
USD 12 Months 0.5721
Benchmark Yields
Tenor Maturity Yield (%)
91 days 17-Apr-14 11.02
182 days 05-Jun-14 11.96
364 days 08-Jan-15 12.96
2 years 23-Apr-15 12.29
4 years 31-Aug-17 12.59
5 years 30-May-18 12.63
Indicative Currency Exchange Rates
Bid Offer
EURUSD 1.3534 1.3584
GBPUSD 1.6419 1.6469
USDJPY 104.16 104.56
USDCHF 0.9115 0.9145
GBPEUR 1.2132 1.2142
USDZAR 10.889 11.039
USDNGN 159.50 159.80
JPYNGN 1.5313 1.5813
CHFNGN 174.99 178.99
EURNGN 215.87 219.87
GBPNGN 261.88 265.88
ZARNGN 14.65 16.65
Fx
Hi Low Close Prev.Close
USD/NGN 160.30/40 159.40/50 159.70/80 159.93/03