Please find below our Weekly Update for the week ended 19th October, 2012.
Key Highlights: -
Macroeconomic /Socio-Political Update
· Inflation in Nigeria has eased for the third straight month to 11.3% percent year-on-year in September, down from its previous 11.7% year-on-year in August.
· Fitch Ratings has declared Nigeria’s Short-term foreign currency IDR at ‘B’. The Country’s Ceiling has been affirmed at ‘BB-’.
Equity Market Review & Outlook
· Sentiments were generally bullish on Global Equities last week; European and Asian stocks both fared well, with the biggest gain of 3.4% recorded by France CAC 40.
· We expect the Nigerian equity market to close in positive territory this week.
Money Market Review & Outlook
· FAAC credits for the month of September 2012 boosted liquidity in the money market last week, sending interbank rates south from an initial three day upward trajectory.
· We We expect money market rates to hover around current levels this week, in view of the current system liquidity.
Foreign Exchange Market Review & Outlook
· The CBN offered US$330.0m but sold US$312.2m at the WDAS last week – US$150.0m and US$162.2m at Monday and Wednesday’s auctions respectively
· We expect the Naira to lose further ground to the greenback at the interbank, BDC and parallel markets this week.
Bond Market Review & Outlook
· The FGN bond market swung in to bullish territory last week, as September’s liquidity inflows from FAAC resulted in drop in yields on all traded instruments (ex the 10yr 9.35% FGN AUG 2017).
· We expect bullish sentiments to persist on domestic fixed income instruments this week.