Global Economy –Rundown:
The American economic landscape was stirred to a new shift in Fed reserves Monetary Policy approach by leaving inflation to hover at an average inflationary target of 2%, and the employment benchmark will be accounted for by deficits from the maximum targeted benchmark, as prior indicators have been deviations from the maximum level of employment. The rephrased employment targeted, simply implies that FED will not be sitting a specific unemployment rate rather attention will focus on event that dedicates the pace of full employment. And according to the inflationary averaging target of the Fed’s will seek to inflation reading hovering above 2% for some time so has to compensate for the periods when it stood below benchmark points. The undertone of the various Fed monetary policy aligned to the fact that the United States economic recovery is at its fragile points.
Domestic Economy –Rundown:
The Nation’s Nominal aggregate Gross Domestic Product for the second quarter was N34.02 Trillion compared to N35.65 Trillion, which depicts a 4.56% decline in nominal GDP. However, the country’s real GDP recorded a 6.10% contraction in the second quarter of the year as against a marginal growth of 1.87% in the first quarter of the year, this dip is connected with the disrupted economic activities that submerged the quarter, as business activity demography revealed that 13 economic activities recorded positive real growth for the quarter, as against 30 business activities that recorded positive real growth for the preceding quarter, as business activities contribution to the real GDP were; Agriculture-24.65%, Industries-21.87%, and Services-53.49%. The sectoral breakdown of the major component of the economy revealed that the Oil sector real growth for the quarter tripped by 6.63%, as average daily oil production dipped to 1.81 million BPD, and the sector’s contribution to the aggregate GDP was 8.93%. Also, the Non-Oil Sector real growth slipped by 6.05%, as its contribution to the aggregate GDP for the quarter was 91.07%.
Currency:
The Naira closed the week with a marginal appreciation, as the exchange rate at the I&E FX window settled at N385.67/USD, while at the parallel market, Naira was flat at N477/USD.
Equities
The equities market bullish run persisted although at a slow pace, as the week-on-week performance indicated a 0.35% appreciation, while the YTD ASI growth was a negative growth of 5.71%. The sector performance of the NSE indices was bullish for the week, as the average change of the NSE Indices was 0.87%, based on the indices monitored.
Fixed Income:
The system liquidity at the end of the week was N650.00BN, and the open buyback rate and overnight rates for the week firmed close at 13.90% and 14.90% respectively.
T-Bills secondary market activities were bearish as average yield inched higher by 15bps to 1.53%% for the week, most yield appreciation was recorded at the medium end of the yield curve.
The Bond secondary market, activities were mainly bearish, as the average yield for the week inched up by 9bps to 8.46%, as most yield appreciation was recorded on the medium -long tenured bond that increased by 28bps and 5bps respectively.
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