The Editorial Team |

Nigeria’s Fixed-Income Investors See Inflation Eroding Returns

LAGOS(Capital Markets in Africa) — Local investors are piling into Nigeria’s short-term debt even though rising inflation means that they are reaping negative real returns. Prices increases in Africa’s largest economy accelerated for a 13th straight month in September, according to data released by the statistics agency on Thursday. Even so, rates on Treasury Bills slipped to the lowest levels seen in more than 10 years at an auction on Wednesday. The one-year bill sold…

Libor Exit Race for Derivatives Awaits ‘Starting Pistol’

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LONDON (Capital Markets in Africa) — The global derivatives market looks set to accelerate its exit from Libor with the impending release of standardized contractual terms designed to ease the transition to new rates. The International Swaps and Derivatives Association, the trade group for the industry, will publish its hotly anticipated Libor protocol on Oct. 23 after receiving approval from the U.S. Department of Justice, ISDA said in a statement on Friday. The publication “will effectively fire…

Fitch Ratings: USD Libor Transition Still Difficult Despite Protocol Milestone

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LAGOS (Capital Markets in Africa) – The January 2021 launch of fallbacks for derivatives contracts that reference Libor will still make it challenging for the industry to adopt new term rates referencing the Secured Overnight Financing Rate (SOFR) before Libor ceases to be quoted at end-2021, Fitch Ratings says. Development of a SOFR term reference rate relies on sufficient liquidity in the SOFR-based USD derivatives market, which remains thin compared to traded notionals for USD…

Trump Boasts at Florida Rally of Feeling ‘So Powerful’

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NEW YORK (Capital Markets in Africa) — President Donald Trump returned to the campaign trail on Monday night, boasting at a rally in Florida that he felt “so powerful” after his recovery from Covid-19 that he wanted to walk into the audience and “kiss everyone.” “I am so energized by your prayers and humbled by your support,” Trump said at the outdoor rally at the Orlando Sanford International Airport, where there was little social distancing…

This Idea Deserves a Nobel, But It’s Failed India: Mihir Sharma

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LAGOS (Capital Markets in Africa) — Economists like to think of themselves as mathematicians — or, if feeling momentarily humbler, as physicists. This year’s winners of the Nobel Prize in economics, however, seem to conceive of themselves more as engineers. Like Alvin Roth and Lloyd Shapley, who won the prize in 2012, Paul Milgrom and Robert B. Wilson are specialists in “market design,” a field which, as Roth wrote in a famous paper, calls for…

What to Watch in Commodities: Alcoa, OPEC, Gold, Glencore, IEA

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LAGOS (Capital Markets in Africa) — Commodity investors embark on an intriguing earnings season this week amid conflicting signals. Raw materials just hit a two-year high — aided by a weaker dollar, hopes for more U.S. stimulus, and gains in food prices — but signs from around the globe suggest the pandemic is worsening. Aluminum giant Alcoa Corp. is among companies in the vanguard, along with major oil-service player Schlumberger Ltd. Top banks including Goldman Sachs Group Inc. will…

Nigeria Pins Hopes on First Gold Project to Boost Mining Sector

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LAGOS (Capital Markets in Africa) — Nigeria’s first industrial gold project is on course to enter production next year, and its success will be crucial for boosting mining in Africa’s biggest oil producer, the country’s mines minister said. Thor Explorations Ltd. is spending $98 million to develop the project, which will have an annual average output of 80,000 ounces. The Canada-based company’s Segilola mine in the southwest should yield gold by the end of the first…

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