Economy
Dec 2016 Inflation Rate Expected to Shrink to 18.44%
By Modupe Gbadeyanka
FSDH Securities Ltd has predicted that Nigeria’s inflation rate for December 2016 is expected to “marginally to 18.44 percent from 18.48 percent recorded in the month of November 2016.”
In its latest report, the firm explained this fall would be driven by lower than anticipated price increases within the Food and Non-Alcoholic Beverages division, as well as the base effect.
The National Bureau of Statistics (NBS) is expected to release the inflation rate for the month of December 2016 on January 13, 2016 based on the information on the twitter handle of the Statistician General of the Federation and Chief Executive Officer of the NBS.
The monthly Food Price Index (FPI) released by the Food and Agriculture Organization (FAO) shows that the FPI remained relatively the same in December. The Index was marginally down by 0.07 percent, compared with its revised November figure. Year-on-year (YoY), it grew by 12.02 percent.
According to the FAO, the performance of the Index was largely driven by a sharp fall in sugar prices. The FAO Sugar Index fell by 8.56 percent, on the back of the weakening Brazilian currency against the US Dollar.
Also, favourable reports emanating from the main producing region (Central South) contributed to the fall in prices. YoY, the Index rose by 26.34 percent.
The FAO Meat Price Index was down by 1.09 percent, as all meat categories recorded lower prices in December 2016.
On the flip side, the FAO Vegetable Oil Price Index appreciated by 4.22 percent. The rebound was primarily driven by lower global inventory level for palm oil. YoY, the Index appreciated by 29.31 percent in December 2016. The FAO Dairy Index appreciated by 3.35 percent from November 2016, as a result of weaker dairy production in the European Union (EU) and Oceania.
The Index recorded a YoY growth of 28.83 percent. The FAO Cereal Price Index increased marginally by 0.50 percent, mainly due to the increase in the prices of rice and maize. YoY, the Index declined by 6.25 percent.
Analysis by the FSDH Securities Ltd indicates that the value of the Naira remained stable at the inter-bank market while it depreciated at the parallel market by 2.65 percent to close at $/N491 from $/N478 at the end of November.
The depreciation in the parallel market led to an increase in the prices of imported consumer goods in Nigeria between the two months under review.
The prices of food items that FSDH Research monitored in December 2016 moved in varying directions.
The prices of vegetable oil, palm oil, meat, fish, sweet potatoes, onions and Irish potatoes were up by 25 percent, 21 percent, 14.2 percent, 12.5 percent, 7.1 percent, 4.2 percent and 4.17 percent respectively.
The prices of tomatoes and beans were down by 5 percent and 4.49 percent respectively. The prices of rice, garri, and yam remained unchanged. The movement in the prices of food items during the month resulted in a 1.04 percent increase in our Food and Non-Alcoholic Index to 216.99 points.
FSDH Securities Ltd said it also noticed increases in the prices of Clothing and Footwear; Housing, Water, Electricity, Gas & Other Fuels divisions between November and December 2016.
It emphasised that its model indicates that the price movements in the consumer goods and services in December 2016 would increase the Composite Consumer Price Index (CCPI) to 213.35 points, representing a month-on-month increase of 0.96 percent.
“We estimate that the increase in the CCPI in December will produce an inflation rate of 18.44 percent,” FSDH Securities Ltd stated in its report.
By Adedapo Adesanya
The duo of Afriland Properties Plc and Geo-Fluids Plc crashed the NASD Over-the-Counter (OTC) Securities Exchange by a marginal 0.06 per cent on Wednesday, December 11 due to profit-taking activities.
The OTC securities exchange experienced a downfall at midweek despite UBN Property Plc posting a price appreciation of 17 Kobo to close at N1.96 per share, in contrast to Tuesday’s closing price of N1.79.
Business Post reports that Afriland Properties Plc slid by N1.14 to finish at N15.80 per unit versus the preceding day’s N16.94 per unit, and Geo-Fluids Plc declined by 1 Kobo to trade at N3.92 per share compared with the N3.93 it ended a day earlier.
At the close of transactions, the market capitalisation of the bourse, which measures the total value of securities on the platform, shrank by N650 million to finish at N1.055 trillion compared with the previous day’s N1.056 trillion and the NASD Unlisted Security Index (NSI) went down by 1.86 points to wrap the session at 3,012.50 points compared with 3,014.36 points recorded in the previous session.
The alternative stock market was busy yesterday as the volume of securities traded by investors soared by 146.9 per cent to 5.9 million units from 2.4 million units, as the value of shares transacted by the market participants jumped by 360.9 per cent to N22.5 million from N4.9 million, and the number of deals increased by 50 per cent to 21 deals from 14 deals.
When the bourse closed for the day, Geo-Fluids Plc remained the most active stock by volume (year-to-date) with 1.7 billion units valued at N3.9 billion, followed by Okitipupa Plc with 752.2 million units worth N7.8 billion, and Afriland Properties Plc 297.5 million units sold for N5.3 million.
Also, Aradel Holdings Plc, which is now listed on the Nigerian Exchange (NGX) Limited after its exit from NASD, remained the most active stock by value (year-to-date) with 108.7 million units sold for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.5 million units worth N5.3 billion.
By Adedapo Adesanya
The euphoria around the recent appreciation of the Naira eased on Wednesday, December 11 after its value shrank against the US Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N5.23 or 0.3 per cent to N1,547.50/$1 from the N1,542.27/$1 it was valued on Tuesday.
It was observed that spectators’ activities may have triggered the weakening of the local currency in the official market at midweek as they tried to fight back and ensure the value of funds in foreign currencies strengthened.
The domestic currency was regaining its footing after the Central Bank of Nigeria (CBN) launched an Electronic Foreign Exchange Matching System (EFEMS) platform to tackle speculation and improve transparency in Nigeria’s FX market.
At midweek, the Nigerian currency depreciated against the Pound Sterling by N3.56 to close at N1,958.68/£1 compared with the preceding day’s N1,955.12/£1 and against the Euro, it slumped by 34 Kobo to trade at N1,612.66/€1, in contrast to the previous session’s N1,613.00/€1.
As for the black market segment, the Naira lost N45 against the American currency during the session to quote at N1,670/$1 compared with the N1,625/$1 it was traded a day earlier.
A look at the cryptocurrency market showed a recovery following profit-taking as the US Consumer Price Index report matched economist forecasts.
The news was enough to convince traders that the Federal Reserve is certain to trim its benchmark fed funds rate another 25 basis points at its meeting next week.
The move also saw Bitcoin (BTC), the most valued coin, return to the $100,000 mark as it added a 2.9 per cent gain and sold for $100,566.12.
The biggest gainer was Cardano (ADA), which jumped by 15.00 per cent to trade at $1.16, as Litecoin (LTC) appreciated by 10.4 per cent to sell for $121.76, and Ethereum (ETH) surged by 7.0 per cent to $3,929.30, while Dogecoin (DOGE) recorded a 6.7 per cent growth to finish at $0.4181.
Further, Binance Coin (BNB) went up by 5.2 per cent to $716.72, Solana (SOL) expanded by 4.6 per cent to $229.77, and Ripple (XRP) increased by 4.2 per cent to $2.43, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) closed flat at $1.00 apiece.
By Aduragbemi Omiyale
The Dangote Refinery located in the Lekki area of Lagos State has made its first export of premium motor spirit (PMS) just three months after it commenced the production of petrol.
In September 2024, the refinery produced its first petrol and began loading to the Nigerian National Petroleum Company (NNPC) on September 15.
However, due to some issues, the facility has not been able to flood the local market with its product, forcing it to look elsewhere.
In a landmark move for regional energy integration, Dangote Refinery has partnered with Neptune Oil to take its petrol to neighbouring Cameroon.
Neptune Oil is a leading energy company in Cameroon which provides reliable and sustainable energy solutions.
Dangote Refinery said this development showcases its ability to meet domestic needs and position itself as a key player in the regional energy market, adding that it represents a significant step forward in accessing high-quality and locally sourced petroleum products for Cameroon.
“This first export of PMS to Cameroon is a tangible demonstration of our vision for a united and energy-independent Africa.
“With this development, we are laying the foundation for a future where African resources are refined and exchanged within the continent for the benefit of our people,” the owner of Dangote Refinery, Mr Aliko Dangote, said.
His counterpart at Neptune Oil, Mr Antoine Ndzengue, said, “This partnership with Dangote Refinery marks a turning point for Cameroon.
“By becoming the first importer of petroleum products from this world-class refinery, we are bolstering our country’s energy security and supporting local economic development.
“This initial supply, executed without international intermediaries, reflects our commitment to serving our markets independently and efficiently.”
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