The Markets | - Part 232

Nigeria’s Currency Chaos Deepens as Bets on Devaluation Rise

LAGOS, Nigeria, Capital Markets in Africa: As investors increasingly bet the bottom will drop out of the naira and the vice president hints at a devaluation, the man who calls the shots – President Muhammadu Buhari, who has resisted letting the currency weaken since coming to power a year ago, likening it to “murder” — has kept quiet. “I won’t believe it until I see presidential ownership of it,” Alan Cameron, an economist at Exotix Partners…

South African Rand Slumps as Gordhan Breaks Silence on Talk of Arrest, Firing

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Johannesburg, South Africa, Capital Markets in Africa: The rand slumped as much as 2 percent against the dollar and bonds fell as concern intensified around the role of South African Finance Minister Pravin Gordhan, who broke his silence over reports that he may be arrested and dismissed. The rand was 1.7 percent lower at 15.8106 by 12:26 p.m. in Johannesburg, the weakest since March 15 on a closing basis and the worst performance among 31 major and developing…

Goldman Upgrades Commodity Outlook on Constrained Oil Supplies

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LAGOS, Nigeria, Capital Markets in Africa: Goldman Sachs Group Inc. upgraded its outlook for commodities for the next three months because of disruptions to oil supply, while staying bearish on industrial metals and gold. Supply constraints should support oil prices, but “physical re-balancing” is incomplete and Goldman remains neutral on commodities for the next 12 months, it said in a report e-mailed Wednesday. The bank is recommending investors buy oil and gas assets in equities and…

Mozambique Says Can’t Pay $178 Million Debt Interest This Month

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Maputo, Mozambique, Capital Markets in Africa: Cash-strapped Mozambique won’t be able to honor a debt-interest repayment of $178 million that is due next week for a loan to a state-run company, Finance Minister Adriano Afonso Maleiane told lawmakers. The nation holds total public debt of $11.64 billion, of which $9.85 billion is owed to foreign investors, he said Wednesday in the capital, Maputo. Mozambique Asset Management, whose payment is due on May 23, is negotiating with lenders…

Deregulation With Price Controls. Precursor to Devaluation?

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LAGOS, Nigeria, Capital Markets in Africa: Last week, the Federal Government finally took a step to pseudo-deregulate the downstream sector (the FGN refused to use the word deregulation). This initiative was expected due to the introduction of the price modulation template by the NNPC in January 2016 and also the 2016 budget had no provisions for petrol subsidy payments. Under the new framework, market players are now permitted to source FX independently of the CBN…

Oil Trades Near Seven-Month High as Supply Losses Tame Surplus

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LAGOS, Nigeria, Capital Markets in Africa: Oil traded near a seven-month high on speculation that U.S. crude stockpiles declined last week while supply losses in Canada and Nigeria whittled away the global excess. West Texas Intermediate climbed as much as 1.5 percent in New York. U.S. crude inventories probably fell by 3.5 million barrels, according to a Bloomberg survey before government data Wednesday. It would be the first consecutive weekly decrease since September. Wildfires in Canada came to within a…

Senegal President Sall Says Nation Will Sell Bond This Year

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DAKAR, Senegal, Capital Markets in Africa: Senegalese President Macky Sall said his administration will tap the international bond market this year to fund infrastructure development and accelerate growth that’s being driven by surging peanut and rice production. The West African nation intends raising $500 million to $1 billion through the sale of a Eurobond, Sukuk or Samurai bonds, Sall said in a May 13 interview in Kigali, Rwanda’s capital, where the World Economic Forum held its annual…

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