Financial Market Update

Local and international financial market update.

NIGERIA: The Central Bank of Nigeria (CBN) in its fourth quarterly report just released said, “at N13,957.43 billion (N13.96 trillion), aggregate banking system credit (net) to the domestic economy, rose by 4.4 per cent at the end of the fourth quarter of 2012, compared with the growth of 0.4 and 37.4 per cent at the end of the preceding quarter and the corresponding quarter of 2011, respectively”. The development relative to the preceding quarter’s level, reflected, according the central bank, is largely due to the 15.1 and 2.3 per cent increase in claims on the federal government and private sector respectively.

EUROPE: European Central Bank council member Jens Weidmann said an appreciating euro alone won’t trigger a cut in interest rates and the exchange rate’s gains are justified by the economic outlook. The strength of the euro “is one factor among many in determining future inflation rates” and “we will certainly not justify any monetary policy decision with one single factor,” Weidmann, who heads Germany’s Bundesbank, said in a Feb. 13 interview.

INDIA: Indian stock index dropped for the second day, erasing this year’s advance, as earnings at some of the nation’s biggest companies missed analysts’ estimates. The BSE India Sensitive Index, or Sensex, retreated 0.3 percent to 19,437.66 at 10:48 a.m. in Mumbai.

CHINA: Citic Group Corp., China’s largest state-owned investment company, will pay about A$452 million ($468 million) for a stake in Alumina Ltd., partner in the world’s biggest alumina business. Alumina’s shares soared. The Australian company’s partner, Alcoa Inc., last month forecast global aluminum demand growth will accelerate to 7 percent this year as China’s economic rebound drives demand for cans, cars and buildings.

Bonds - Bond yields aligned with new primary auction cut-off rates at start of yesterday’s session. The 20yr 10.00% FGN JUL2030 reopening was sold at 10.90% yield after been issued in November 2010 at 14.50% yield.

Bills - Few trades on the bill curve riding on liquidity inflow yesterday which pulled lending rates down.

Money Market - OBB and O/N rate down to 11% and 11.25% respectively, ngn195.263 bio repaid yesterday from a maturing t-bill. Bond and FX auction funding today.

Indicative Currency Exchange Rates
Bid             Offer
EURUSD        1.3368           1.3378
GBPUSD         1.5520           1.5530
USDJPY          92.44             92.84
USDCHF        0.9213           0.9233
GBPEUR        1.1609            1.1619
USDZAR        8.8061           8.9061
USDNGN       156.98           157.73
JPYNGN        1.6982           1.7482
CHFNGN       170.39           174.39
EURNGN       209.85          213.85
GBPNGN       243.63           247.63
ZARNGN       17.83              19.83

Commodities
West Texas Intermediate oil headed for its ninth weekly gain in 10 weeks. Open interest for the U.S. benchmark grade rose to a record while a report signalled OPEC will cut crude shipments this month. Crude for March delivery was at $97.23 a barrel, down 8 cents, in electronic trading on the New York Mercantile Exchange at 3 p.m. Singapore time.

Interest rates
NIBOR (%)                       LIBOR (%)
O/N              11.8333           USD 1 month             0.2017
7 Day            12.0417           USD 2 month             0.2470
30 Day         12.4583           USD 3 month            0.2901
60 Day         12.8333           USD 4 month            0.3446
90 Day         13.0833           USD 6 month            0.4649
USD 12 month          0.7625
Y/Y Consumer Inflation December 2012 :         12.00%
FX Reserves: 02 February 2013 (USD bn)         46.219
MPR                                                                            12.00%
Source: Reuters, Bloomberg, Central Bank of Nigeria, Financial Market Dealers Association Standard Chartered Bank Nigeria.

Fx
Hi              Low            Close           Prev.Close
USD/NGN   157.30/40    157.20/30   157.23/33      157.30/40

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