Most Food Prices In Nigeria Have Shrugged off The Currency Gains and Remained Relatively Static


Friday, November 10, 2017 / 10:45 AM /FDC


The Naira has remained relatively stable at N363/$ in the forex market since April 2017. Gross external reserves climbed to $34.09bn, for the first time in 32 months. Most food prices in Nigeria have shrugged off the currency gains and remained relatively static.


In the meantime, brent oil price has stayed above $63pb, however the build-up in U.S crude inventories has limited further spikes in the price.


Burning Economic Issues  

·         Brent crude up marginally to $63.54pb

·         Moody’s downgrades Nigeria’s credit rating to B2 (with a stable outlook)

·         FG saves N4.7bn through TSA and N20bn through IPPIS/BVN monthly

·         CBN intervenes with $195mn in to FX market

·         External reserves climbs to $34bn

·         Naira unchanged at N363/$ (parallel), IEFX: N306.40/$

Economic News  

The Good 

·         Power output up 2.8% to 3,801MW/hr

External reserves up to $34.01bn

The Bad
·         Nigeria’s downgrade means higher cost of international borrowing

Power Generation analysis & Impact
November 06th: Average power output sent was 3,806WWh/hour (up 104.31MWh/h)

Gas constraint was 1,137.2MW; frequency management constraint due to loss of DisCo feeders was 1,034MW, water management constraint was 150MW

Estimated loss: N1.114bn (annualised at N406.61bn /$1.23bn)

Shiroro Hydro has commenced water management measures to ensure dry season efficiency  

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Domestic Commodity Prices Movement
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Proshare Nigeria Pvt. Ltd.

Stock Market 
·         NSE ASI 0.24% to 37,051.54pts

Consumer goods sub index 0.06% to 913.04pts

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Oil prices
·         Brent crude 0.08% to $63.54pb

China's October imports fell to 7.3mbpd from 9mbpd in September

Markets remains supported largely due to OPEC-lead supply cuts

Growing tensions in the Middle East kept a cautious tone on trade

Oil markets today

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Outlook – Oil Prices
·         Slightly higher price levels will likely be sustained in the near term

On rising global demand and tighter supply

Strong macro-economic backdrop and inventory drawdown in the US

Outlook – Agric Prices
·         The market will focus on USDA supply and demand report released later this week


·         Prices will be determined by supply/demand dynamics

·         Lower production forecasts in Ivory Coast will keep prices elevated

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