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Recent Spike in Commodity Prices Confounded Analysts

The recent spike in commodity prices especially beans and yellow garri confounded most analysts. Also noteworthy is the price of cement which has spiked 17.3% to N2,700.

Typically the price of cement falls during the raining season. This contrarian movement is most likely due to the surge in demand due to an aggressive civil construction agenda of the federal and state governments.

In spite of these aberrational price increases, analysts are still convinced that the inflation numbers for April will still show a slight decline.

The FDC Think Tank summarizes these events in a month which promises to be interesting with the release of key economic variables.

Burning Economic Issues

Economic News

The Good

The Bad

• Budget delay likely to derail economic recovery targets

Power Generation analysis & Impact

  • Domestic Commodity Prices Movement

Burning Economic Issues


Stock Market 

•         NSE ASI 0.7% to 26,419.17 pts
•         Positive market sentiment supporting price rally based on corporate earnings
•         Mainly in the banking sector

Oil prices

•         Brent crude by 2.11% to $49.4pb
•         Saudi Arabia anticipates an extension in the output cut deal beyond 2017
•         Rally in the market despite waning Chinese demand in April
•         China’s crude imports eased by 9% to 8.37mbpd
•         YoY comparisons show China crude imports up 5%

Oil markets today

Outlook – Oil Prices

•         Oil prices might be reaching capitulation point – Goldman

Outlook – Agric Prices

• Grains expected to trade positive on planting and weather conditions

• Market remains oversupplied, to trade bearish in the short-term

• Prices to be driven by supply fundamentals despite slight rally in prices

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