Severely depressed Oil
prices have hit Nigeria’s government revenues, weighed on official Naira pegged
against the Dollar and fuelled concerns over the implementation of the 2019
budget which pegged Oil at $60 per barrel. With the nation still in the process
of recovering from a recession, the government may think twice about joining
OPEC in production cuts.
It must be kept in mind
that Nigeria was exempted from the OPEC deal signed in November 2016 thanks to
domestic risk factors. With the security situation in Nigeria still fragile,
growth slowly picking up momentum and diversification plans in the process,
this may not be the best of times for the nation to limit production.
The current environment
certainly presents a strong argument for OPEC+ to take action in a bid to stop
Oil prices sinking into 2019. While a cut is on the cards, the question on the
minds of many investors will be how much will be cut and how it will be split
among OPEC+ members. Markets are projecting OPEC to cut production by roughly
over one million barrels per day from November’s level. A cut that is in line
with market expectations will be supportive of Oil prices. However, if OPEC
disappoints by leaving production unchanged, Oil prices are at threat of
tumbling sharply.
Dollar
on standby ahead of NFP
Away from Nigeria, the Dollar is likely to remain in a narrow range
ahead of the US jobs reports scheduled for release on Friday. The Dollar was
attacked from all directions earlier in the week after an inversion of the US
Treasury yield curve stimulated fears over the US economy decelerating.
Sentiment towards the Greenback could still swing in favour of the bulls this
week if the US jobs report ticks all the boxes. A strong NFP figure coupled
with signs of accelerating wage growth in November will reinforce expectations
of higher US interest rates in 2019.
Sterling
unsettled by Brexit uncertainty
Political drama in the
United Kingdom has left the British pound quite unsettled. Theresa May’s
repeated defeats in parliament are discouraging and likely to fuel pessimism
over her Brexit deal being squarely rejected next week. Market fears over the
UK crashing out of the European Union with no deal in place should keep Pound
bears in the game for the rest of this week.
Focusing on the technical
picture, the GBPUSD is certainly bearish on the weekly charts. Prices are
trading below the 20 Simple Moving Average while the MACD has crossed to the
downside. A solid breakdown below the 1.2700 should provide bears with enough encouragement
to target 1.2590.
Commodity
spotlight – Gold
Where Gold concludes this
trading week will primarily depend on the pending US jobs report released on
Friday.
Have you heard this? Many Nigerian exporters have been defrauded of huge amount of money in the process of exporting commodities to foreign countries. Do you know why? They were not trained on export operations, management, documentations and the best methods of payment in export trade. This is terrible!!! Nigerians cannot continue to lose money to foreigners in the course of export business. Exporters, why don’t you get a practical manual that teaches the stages of export trade from processing and packaging of commodities to receipt of payment by the foreign buyers. It teaches export operations, export management, export documentations and methods of payment in export trade? It is a contemporary step-by-step guide to export trade. It tells all the contemporary dynamics in export trade. To get it, click on the link below:
http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html
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