FG set to unveil the e-Naira on Monday, October 25th
President Muhammadu Buhari is scheduled to formally unveil the Nigerian Central Bank Digital Currency (CBDC), known as the eNaira, on Monday 25 October 2021, at the State House, Abuja.
This is according to a notification by the Central Bank of Nigeria, signed by its Director, Corporate Communications, Osita Nwanisobi, stating that the digital currency will be launched with the theme, “Same Naira, more possibilities”.
The announcement of the launch of the digital currency is coming after an earlier postponement by the apex bank.
“The launch of the eNaira is a culmination of several years of research work by the Central Bank of Nigeria in advancing the boundaries of payments system in order to make financial transactions easier and seamless for every stratum of the society. Following series of engagements with relevant stakeholders including the banking community, fintech operators, merchants and indeed, a cross-section of Nigerians, the CBN designed the digital currency, which shall be activated on Monday, October 25, 2021.,” the CBN stated.
“Since the eNaira is a new product, and amongst the first CBDCs in the world, we have put a structure to promptly address any issue that might arise from the pilot implementation of the eNaira.
Accordingly, following Monday’s formal launch by the President, the Bank will further engage various stakeholders as we enter a new age consistent with global financial advancement,” the Apex bank added.
Gold shines for two consecutive weeks amid tapering
Gold prices are expected to be bullish in the coming week, as a weaker dollar and worries about rising inflation is expected to bolster the demand for the safe-haven asset.
On Friday, gold longs enjoyed a rollercoaster ride that took them as high as $1,800, then dropped and finally closed positively.
New York’s Comex settled December gold at $1,796.30, an increase of 0.8%. The metal shot up to $1,815.50 earlier in the session, only the second time in a week it has surpassed $1,800.
The benchmark gold futures contract gained 1.6% for the week, extending its 0.6% gain from the previous week.
Gold prices moved Friday after Federal Reserve Chairman, Jerome Powell announced that it will start tapering its monthly stimulus of $120 billion between November and December, but did not provide a timeline for rate hikes.
Timing of the taper had kept the markets on tenterhooks for months. Rates have now become the focus of speculation.
Powell revealed that the Fed will begin tapering in mid-2022, that transitory inflation will last longer than expected, and that rate hike expectations should be written with caution.
Even though gold finished in the positive and up more than 1.5% in the week, its inherent strength was still apparent after weeks spent trading in the mid to lower $1,700 range.
Read also: Stabilizing the Naira amid calls for devaluation
Oil at its strongest as it sustains 8 weeks gains in a row amid global energy crisis
In the coming week, oil prices are expected to rise on tight U.S. supply even as coal, gas crunch eases.
Oil prices rose higher on Monday following an eighth weekly gain, buoyed by recovering demand and high natural gas and coal prices which has encouraged users to switch to fuel oil and diesel for power generation.
The Brent crude, the global benchmark, was up by 85 cents to trade at $85.71 a barrel, while the Western Texas Intermediate (WTI) was at its strongest in almost 7 years on Monday.
The WTI was up $1.26 to trade at $83.54 per barrel after hitting $83.73 per barrel earlier on Monday, their highest since October 2014, while natural gas dropped by 90 cents to trade at $5,320.
Japanese Prime Minister, Fumio Kishida, on Monday, urged oil producers to increase output to cushion the blow to industries hit by the recent spike in energy costs.
China’s power crunch intensified on Monday as coal prices rose to a record high following data showing the supply of the fuel fell in September adding to concerns that domestic output may be unable to meet surging electric generation demand.
Oil prices fell on Friday with Brent poised for its first weekly dip in seven weeks as demand for oil products in power generation cooled off amid easing coal and gas prices, while a forecast for a mild U.S. winter also weighed on the market. Brent had a weekly growth of 1.03%.
NBS RELEASE CALENDAR FOR THE WEEK AHEAD
The NBS release calendar for the coming week indicates the following:
· Monday 25th October, 2021: Selected Food Prices September 2021 & Transport Fare watch September 2021.
· Wednesday 27th October, 2021: Federal Account Allocation Account (FAAC) (September 2021 Disbursement
· Thursday 28th October, 2021: National Housing Survey
Currency Market
The Naira retraced from the record lows it hit in the previous week, appreciating for most of the trading session during the week. At the close of trading on Friday, it closed at N415.07/US$ remaining for flat on a week-on-week (W-on-W) basis both at the I & E FX Window and NAFEX window. More of the same is expected in the coming week.
Money Market
Money market rates were elevated last week despite a robust system liquidity.
At the close of the trading on Friday, open buy-back (OBB) and overnight rates (O/N) was 19.5% and 19.25% respectively indicating a W-o-W fall of -2.56% and -3.75% for OBB and O/N.
Rates are expected to hover around current levels, barring any inflows from the Apex bank.
Treasury Bills Market
The treasury bills market was mostly mixed last week, with the bears and bulls leading the market in different trading sessions.
At the close of the market on Friday, average benchmark yields for T-bills closed at 5.38%, OMO bills at 6.44%, and CBN’s special bills closed at 5.97%. Posting a W-o-W rise of +3.43% for the T-bills, while OMO bills and average yields for CBN’s special bills fell by -0.46% and -1.05% respectively.
Activity next week is expected to be dictated by the market liquidity situation.
FGN BOND and EUROBOND market
The bond market was bullish last week as the bulls dominated most of the trading session. At the close of trading on Friday, the trend was sustained, with selling pressure across the board.
The overall average benchmark yields closed at 8.40% at the close of trading indicating a W-on-W rise of +1.81%.
The Eurobond market continued its bearish bias this week, buoyed by the persistent uptick in the U.S 10-year treasury.
More of the same is expected in the week ahead.
Nigerian Capital Market
Activity on the local bourse last week was positive as Investors gained N169.66bn W-o-W, NGXASI Inched up by +0.78% to Close the Week Positive. Year-to-date return moderated to +3.71%, while the market capitalization settled at N21.79 trillion.
The volume and values of shares traded on the exchange last week dipped by -44.88% and -41.92% respectively.
Sectoral performance across sectors tracked was mixed last week as the NGX-IND was the highest gainer for the week with +2.59%. NGX Oil and Gas, NGX Banking closed positive with +1.40%, +0.69% while NGX Insurance and NGX Consumer Goods closed negative with a decline of -1.31% and -1.05% respectively.
Market breadth for the week closed negative with 34 gainers led by NGXGROUP and CUTIX as against 36 losers led by ROYALEX and UNIVINSURE.
In the coming week, we expect the possibility of bargain hunting as investors look to take advantage of the result season. However, press releases from listed companies and other macroeconomic developments are also likely to impact investors’ decisions.
In addition, we expect investors to monitor the movement of yields in the fixed income market.
