Financial market update

17 April 2012, Sweetcrude, Lagos - Local and international financial market update.
NIGERIA: American Jim Yong Kim was voted by the World bank’s board today to be the organization’s next president, beating Nigerian finance minister Ngozi Okonjo-Iweala following what was the first ever challenge to the US nominee in the Institutions history.

EUROPE: The euro touched the lowest level against the yen since February as Spanish bond yields touched a 2012 high after a minister called on the European Central Bank to do more to stem debt-market turmoil. The 17-nation currency reached below $1.30 for the first time in two months before rising against most major peers as risk appetite improved and stocks erased losses. Norway’s krone and the South African rand strengthened as U.S. retail sales rose more than forecast, boosting confidence in the recovery of the world’s biggest economy.

INDIA: India’s inflation slowed less than estimated in March as food and fuel prices rose, limiting room for cuts in interest rates to bolster a weakening economy. The benchmark wholesale-price index advanced 6.89 percent from a year earlier, the commerce ministry said in a statement in New Delhi today, compared with a 6.95 percent climb in February and the median 6.65 percent estimate in a Bloomberg News survey of 33 economists.

The Reserve Bank of India, which reviews policy today, has signaled readiness to lower borrowing costs for the first time since 2009 to boost domestic demand as Europe’s debt crisis and a slowdown in China dim the global outlook. It has also flagged the risk of a revival in price pressures because of the rupee’s slide, costlier oil and the fiscal gap.

Bonds - Light sell-off across the curve ahead of this month’s auction later this week, as anticipated demand is expected to be weak in the secondary market until after the auction , any current demand will be channeled to the auction as a first choice of sourcing.

Bills - Relatively flat trading session with few trades recorded, a stable and calm week is expected up until Thursday, were the bond auction results will be announced and as well as liquidity inflow from the maturing OMO bill.

Money Market - OBB and Unsecured rates up another 25bps to start the week at 14.00% and 14.50%, cash balance closed at N 32 billion short and is expected to dip further as banks fund FX auction settlement on Wednesday.

FX
                             Hi               Low           Close            Prev.Close
USD/NGN     157.40/50    157.10/20    157.35/45     157.25/35

 NIBOR (%)                                        LIBOR (%)

 

O/N

 

14.6250

 

USD 1 month

 

0.2398

 

7 Day

 

15.0000

 

USD 2 month

 

0.3466

 

30 Day

 

15.6250

 

USD 3 month

 

0.4657

 

60 Day

 

16.0000

 

USD 4 month

 

0.5651

 

90 Day

 

16.2917

 

USD 6 month

 

0.7319

 

USD 12 month

 

1.0502

 

Y/Y Consumer Inflation February 2012 :

 

11.90%

 

FX Reserves: 13 April 2012 (USD bn)

 

36.087

 

MPR

 

12.00%

 

Source: FMD and CBN