The overnight and OBB rates ticked higher to 41.67% and 38.33% from 27.67% and 26.67% respectively, as market liquidity remains tight following the debit for the retail SMIS auction last Friday.
Rates are expected to remain high until the later part of the week when there is an OMO bill maturity.
Interbank spot: USD/NGN
Activity in the NIFEX market has remained muted, with the CBN being the major supplier of liquidity. NAFEX trade volume for yesterday slid to US$78.48bn, down
from closing levels of US$346.36bn last week. The exchange rate has remained stable on the back of sustained interest in the Nigerian fixed income and equity markets. We expect the pair to continue to trade in the 360-362 range in the short term.
Yields on short-dated papers rose by 14bp yesterday as funding charge remains relatively high. The FGN bond space saw demand persist on the day as positive GDP data for 3Q17 as well as the successful issuance of the 10-year and 30-year Eurobond of US$1.5bn each, with a reported bookbuild of over US$11.0bn. The cut-off rates were 6.500% and 7.625% respectively.
The MPC commenced its two-day meeting yesterday. We expect the status quo to be maintained when the decision is announced later today. We expect to see yields drop at the short end of the curve in anticipation of the liquidity inflow from the OMO bill maturity and monthly statutory disbursement. Similarly, interest in the bond space should persist on the back of the Eurobond news.
OPEC needs to extend limits on oil output to help rein in the remaining excess in global supply, but isn’t considering making deeper cuts, the United Arab Emirates energy minister said. The group is talking about prolonging production curbs when its members meet at the end of the month and won’t discuss any increase in the size of the cuts, Energy Minister Suhail Al Mazrouei said on Monday in Abu Dhabi. About 158 million barrels in surplus oil inventories still need to be cleared, he told reporters.
|Current rate (%)||Current|
|LIBOR 30-day||1.28719||Brent Crude||US$ 62.50|
|NIBOR 30-day||17.4873||NAFEX (Offer rate)||361.50|
|NIBOR 90-day||19.7184||Reserves (as at 06 Nov 2017)||US$33.31bn|
RMB Nigeria indicative term deposit rates1
Note: 1. Indicative rates are gross of withholding tax (10%)
RMB Nigeria Note: The deposit placement is subject to the completion of on-boarding forms (KYC) for RMB Nigeria, a compliance requirement from the Central Bank of Nigeria. Currencies available on request: ZAR/EUR/GBP.
International rating – RMB Nigeria is a wholly owned subsidiary of the FirstRand Bank [BB+ /Baa3] S&P and Moody’s respectively.