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Research

NSR H2 2019 Excerpts – Inflation – A tale of two seasons

By | Ask Shade, Research | No Comments

Nigeria Strategy Report – H2 2019 Excerpts Domestic Economy and Policy Environment In this morning’s cut-out of our core strategy document – The Nigeria Strategy Report, we focus on the major themes that steered consumer prices over H1 19 and delineate our outlook for inflation over H2 2019. Consumer prices ticked up by 5bps to 11.32% over the first half of 2019, mirroring the conflict induced increase in food prices in Q2 19. For the first three months, inflation maintained a downward trajectory, followed by an unanticipated rise in farmers-herdsmen conflict which changed the inflationary trend in April and May….

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Nigerian Consumers: Nestle and Unilever

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Competition gradually blighting the Food business. • Central to the Q2 19 earnings of Nestle and Unilever is the telling impact of increased competition in the food business and improved input cost management. For Nestle, EPS grew 4.3% YoY to N16.90 due to gains from increased local sourcing of raw materials and higher sales. On the flipside, having restated its Q2 18 financials, Unilever reported 30% YoY decline in EPS to N0.35 reflecting increased input and finance cost following exchange rate differentials relative to prior year. • Over the rest of 2019, we expect normalization in margins for both companies…

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In the news: CBN pumps $304.4m into FX market

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This Day BDC Operators Hail Moves to Return Nigeria to JP Morgan Index The Association of Bureaux De Change Operators of Nigeria (ABCON) has said the federal government’s plan to open talks with JPMorgan Chase & Co. for their reinstatement in the local-currency emerging-market bond index will bring great benefits to the economy. Kaduna Refinery Shut over Lack of Crude The Kaduna Refining and Petrochemical Company (KRPC) shut down operations on January 15 due to the non-availability of crude oil. CBN Pumps Fresh $304.4m into Forex Market The Central Bank of Nigeria (CBN) at the weekend intervened in the Retail…

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In the news: Stock Market hits nine-year high

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Punch Fuel queues return to Lagos, Ogun …NNPC blames hitch on vessels berthing Long queues of desperate motorists and other users of Premium Motor Spirit returned to many filling stations in Lagos and Ogun states on Saturday and Sunday after a brief relief from the severe scarcity of the product that rocked the country from December to early this month. PIGB’ll reduce N200bn oil revenue losses – NEITI The Nigeria Extractive Industries Transparency Initiative on Sunday welcomed the decision by both chambers of the National Assembly to pass the Petroleum Industry Governance Bill and stated that it would help reduce…

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In the news: FG to borrow N110bn via bond auction

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Punch FG to borrow N110bn via bond auction The Federal Government is planning to raise N110bn by selling sovereign bonds with maturities of five and 10 years on January 24. N’Delta militants threaten fresh attacks on oil assets After a year of ceasefire, militants under the aegis of the Niger Delta Avengers on Wednesday threatened to attack some offshore oil and gas facilities in the oil-rich region in a few days’ time. No suspicious items in 2018 budget, says FG The Ministry of Budget and National Planning on Wednesday said contrary to claims that the 2018 budget was filled with…

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ECONOMIC UPDATE: Africa Economy back from the Brink

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Given recently released data and estimates, Africa’s economy is back from the brink and on course for a modest recovery in 2017 as higher global commodity prices supported growth in Sub-Saharan Africa (SSA) while fiscal consolidation was responsible for the modest growth seen in the North. Specifically, after increasing at its slowest pace in 2 decades in 2016 (+1.4% YoY), IMF estimates SSA growth at 2.6% YoY following strong rebound in Nigeria, South Africa (SA) and Angola. Whilst higher crude production and prices propelled oil sector growth in the two largest oil exporting nations in Africa, the impact of receding…

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In the news: Nigerian stocks are world’s best with 12% rise

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This Day Oil Marketers Canvass for Total Deregulation of Petroleum Downstream Sub-sector The Independent Petroleum Marketers Association of Nigeria (IPMAN) and Depot and Petroleum Products Marketers Association (DAPPMA) have called for the total deregulation of the downstream sub-sector of the country’s oil and gas industry. Vitafoam  Secures N2bn  Loan to Boost Working Capital Vitafoam Nigeria Plc has secured a four-year   N2billion soft loan from the Bank of Industry (BoI) at concessionary interest rate as part of the company’s strategic move to boost its working capital and sustain competitive edge. With 12% Rise in Fourteen Days Nigerian Stocks Are World’s Best…

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In the news: Investors’ wealth appreciates further by N517 billion

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Punch Licence renewal: BDCs seek extension of January deadline The Association of Bureaux De Change Operators of Nigeria, the umbrella body of over 3,500 BDC operators licensed by the Central Bank of Nigeria in the country, has called on the regulator to extend the January 31 deadline set for the renewal of operating licence of its members to March 31, 2018. NNPC seeks 1.46 million MT of petrol for January-April In a sign that the scarcity of petrol in Nigeria could be more widespread than first expected, the Nigerian National Petroleum Corporation has issued a spot tender seeking 1,480,000 metric…

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ECONOMIC UPDATE: Constructive flows to EMs but headwind prospers

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Recovery in EM growth spurs portfolio flows In contrast to a sharp decline in capital flows to emerging markets between 2015 and 2016, portfolio flows proved resilient in 2017. The Institute of International Finance (IIF), estimated portfolio inflows to EMs over 2017 at $243 billion (+40%% YoY)— the highest level since 2014— underpinned by broader global economic recovery, higher risk appetite and favourable global financial conditions. On the pull side, higher commodity prices and improving economic fundamentals which lessened default risk as well as a more stable currency market were key drivers for the strong portfolio flows. Importantly, despite rate…

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In the news: Equities Market Begins 2018 on Bullish Note

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Punch Nigerian banks stop ATM cash withdrawal abroad A number of Deposit Money Banks in the country have barred their customers from using debit and credit cards to withdraw dollars, euros, pounds and other foreign currencies whenever they travel abroad. Fuel scarcity: Senate invites PPPRA, Customs, NPA, others The Senate has extended its investigation into the lingering scarcity of Premium Motor Spirit (also known as petrol) to more Federal Government agencies and parastatals. 14 power plants shut, hydro generation improves Electricity generation from the nation’s hydropower plants has recorded significant improvement, offsetting the losses caused by last week’s pipeline fire…

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