Economy
August 2017 Inflation to Drop to 15.99%—FSDH
By Modupe Gbadeyanka
Analysts at FSDH Research have projected inflation rate (year-on-year) for the month of August to further moderate to 15.99 percent from 16.05 percent in July 2017.
In its latest report, FSDH said the expected decrease in the inflation rate is largely attributed to the downward movement in some categories of non-food items in the Consumer Price Index (CPI) basket, as well as decrease in some food prices.
A check by Business Post on the data release calendar on the website of the National Bureau of Statistics (NBS) showed that the stats agency will release the inflation rate for August on Friday, September 15, 2017.
In February 2017, the inflation rate declined for the first time in 15 months by 0.94 percent and it has been going down gradually since then.
According to FSDH, the monthly Food Price Index (FPI) that the Food and Agriculture Organization (FAO) released yesterday indicates that the Index averaged 176.6 points in August 2017, 1.30 percent lower than the July 2017 value.
According to the FAO, the decline in the FPI for August 2017 reflected generally lower values for cereals, sugar and meat than prior month and more than compensated for the increase in the vegetable oil and dairy prices.
The FAO Sugar Price Index decreased by 1.7 percent in August, from July 2017 and has been on downward trend since the beginning of 2017. The decline in the FAO Sugar Index was mainly driven by favourable prospects for cane harvests in major producing countries.
The FAO Cereal Price Index was also down by 5.40 percent in August 2017. Cereal prices were driven downwards by large global supplies. The FAO Meat Index was also down by 1.2 percent in August, compared with July figure. On the flip side, The FAO Vegetable Oil Price Index was up by 2.50 percent, driven by rising quotations for palm oil and soy oil. The FAO Dairy Price Index also appreciated by 1.4 percent in August 2017.
“Our analysis indicates that the value of the Naira depreciated marginally at both the inter-bank and parallel markets. The value of Naira lost by 0.07 percent to close at N305.85/$ at the inter-bank market and lost by 0.27 percent to close at N368/$ at the parallel market at the end of August 2017, compared with July 2017. The marginal depreciation in the value of the Naira is not expected to have a significant negative pass-through effect on local prices because of the fall in price of major imported food items in the international food market.
“The prices of some of the food items we monitored in August 2017 moderated downwards, while a few major items recorded price appreciation. The movement in the prices of food items during the month resulted in 1.19 percent increase in our Food and Non-Alcoholic Index to 251.83 points.
“Our Food and Non-Alcoholic Index increased by 20.23 percent to 251.83 in August 2017, compared with 209.45 in August 2016.
Housing, Water, Electricity, Gas and Other Fuels; Transport; and Furniture and Household Equipment Maintenance Indices increased at various magnitude during the period.
“Our model indicates that the general price movement in the consumer goods and services in August 2017 increased the Composite Consumer Price Index (CCPI) to 239.27 points, representing a month-on-month increase of 0.95 percent.
“We estimate that the increase in the CCPI in August 2017 would produce an inflation rate of 15.99 percent marginally lower than the 16.05 percent recorded in July 2017,” FSDH said in the report titled Inflation Watch.
By Adedapo Adesanya
The duo of MRS Oil and FrieslandCampina Wamco Nigeria Plc weakened the NASD Over-the-Counter (OTC) Securities Exchange by 0.68 per cent on Friday, June 5.
MRS Plc lost N19.00 during the session to sell at N171.00 per share compared with Thursday’s value of N190.00 per share, and FrieslandCampina Wamco Nigeria Plc depreciated by N8.70 to finish at N181.68 per unit compared with the preceding session’s N190.38 per unit.
As a result, the market capitalisation further lost N22.59 billion to close at N2.607 trillion versus the N2.630 trillion it ended a day earlier, and the NASD Unlisted Security Index (NSI) dropped 37.76 points to settle at 4,358.32 points, in contrast to the previous day’s 4,396.08 points.
The alternative stock market closed the last trading day of this week with a price gainer, Central Securities Clearing System (CSCS) Plc, which gained 6 Kobo to quote at N78.40 per share compared with the preceding session’s N78.34 per share. However, it could not prevent the market from going down at the close of business.
Yesterday, the volume of securities bought and sold by investors went down by 50.0 per cent to 140,345 units from the preceding day’s 280,714 units, the value of stocks decreased by 16.5 per cent to N17.9 million from the previous session’s N21.5 million, and the number of deals carried out by market participants fell by 35.7 per cent to 27 deals from the 42 deals recorded on Thursday.
When trading activities closed for the day, Great Nigeria Insurance (GNI) Plc remained the most active stock by value on a year-to-date basis, with 3.4 billion units exchanged for N8.4 billion, trailed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units sold for N6.5 billion, and CSCS Plc with 64.7 million units traded for N4.4 billion.
GNI Plc also ended the session as the most traded stock by volume on a year-to-date basis, with 3.4 billion units worth N8.4 billion, followed by Infracredit Plc with 2.3 billion units transacted for N6.5 billion, and Resourcery Plc with 1.1 billion units valued at N415.7 million.
By Dipo Olowookere
Renewed interest in financial stocks and others lifted the Nigerian Exchange (NGX) Limited by 0.15 per cent on Friday.
Customs Street closed higher yesterday despite the 1.37 per cent loss recorded by the consumer goods sector as a result of profit-taking.
This was offset by gains in the other key sectors of the local bourse, as the insurance counter chalked up 1,14 per cent. The banking space appreciated by 0.90 per cent, the industrial goods segment grew by 0.46 per cent, and the energy sector expanded by 0.01 per cent.
Consequently, the All-Share Index (ASI) went up by 366.00 points to 242,593.31 points from 242,227.31 points, and the market capitalisation gained N235 billion to close at N155.594 trillion compared with the previous day’s N155.359 trillion.
The trio of International Energy Insurance, Abbey Mortgage Bank, and DAAR Communications improved by 10.00 per cent each yesterday to N7.26, N9.35, and N1.98, respectively, while Zichis advanced by 9.39 per cent to N32.38, with Sovereign Trust Insurance up by 8.70 per cent to N2.50.
On the flip side, Academy Press lost 9.84 per cent to quote at N8.25, University Press depreciated by 9.73 per cent to N5.10, Africa Prudential dipped by 2.63 per cent to N12.95, Chams crumbled by 2.44 per cent to N4.00, and International Breweries slipped by 1.59 per cent to N12.35.
Business Post reports that the market breadth index was positive during the session after recording 37 appreciating equities and 14 depreciating equities, implying strong investor sentiment.
Abbey Mortgage Bank led the activity chart with a turnover of 164.1 million units worth N1.5 billion, Ellah Lakes sold 76.7 million units for N767.2 million, Access Holdings transacted 44.8 million units valued at N1.1 billion, Linkage Assurance exchanged 23.0 million units worth N41.2 million, and The Initiates traded 20.2 million units for N562.1 million.
At the close of trades, market participants transacted 608.5 million units worth N32.0 billion in 53,826 deals versus the 588.5 million units valued at N27.9 billion executed in 57,352 deals in the previous session. This showed that the number of deals eased by 6.15 per cent, the volume of transactions rose by 3.40 per cent, and the value of transactions soared by 14.70 per cent.
By Adedapo Adesanya
The Naira further depreciated against the United States Dollar by N3.46 or 0.25 per cent to N1,362.21/$1 from N1,358.75/$1 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Friday, June 5.
However, it appreciated against the Pound Sterling in the same market window during the session by N4.47 to trade at N1,823.59/£1 compared with the previous day’s N1,828.06/£1, and gained N7.00 against the Euro to sell at N1,574.58/€1, in contrast to Thursday’s closing price of N1,581.58/€1.
For another trading session, the Nigerian Naira maintained stability against the Dollar in the parallel market and the GTBank forex counter on Friday at N1,375/$1 and N1,372/$1, respectively.
The Naira is expected to remain strong in the near term, backed by a rise in external reserves, which are nearing $50 billion, enhancing analysts’ confidence about its outlook in the second half of 2026.
Heightened global uncertainty has reduced the incentive for importers and corporates to demand FX, as cautious trade weighs on import needs. Analysts estimate a $40 billion net FX position for the year, a projection anchored in oil windfall gains.
As for the cryptocurrency market, prices remained depressed following a strong US jobs report that spurred markets to price in higher-for-longer interest rates, sending Treasury yields and the dollar up while hammering stocks, especially AI-related names. Crypto markets saw heavy leverage washouts with about $1.6 billion in positions liquidated over 24 hours.
Ethereum (ETH) gave up 4.9 per cent to trade at $1,584.68, Solana (SOL) fell by 3.3 per cent to $63.22, Bitcoin (BTC) crashed by 1.9 per cent to $61,333.23, Dogecoin (DOGE) slipped by 1.8 per cent to $0.0821, and Ripple (XRP) moderated by 1.8 per cent to $1.09.
Further, TRON (TRX) dropped 1.6 per cent to sell at $0.3197, Binance Coin (BNB) slumped by 1.0 per cent to $581.18, and Cardano (ADA) declined by 0.4 per cent to $0.1589, while the US Dollar Tether (USDT) gained 0.07 to sell at $0.9997, and US Dollar Coin (USDC) closed flat at $0.9998.
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