Overview

Bearish sentiment was evident across Nigeria's financial markets during October. Selling pressure was seen across equity, T-bill and FGN bond markets. There was also pressure on the exchange rate of the Naira in the I&E window. Looking at the macroeconomic side, September's headline inflation rose by 25bps to 20.77% y/y, the slowest rise since March, but still at a record level over the past few years. Food inflation (+22bps to 23.34% y/y) rose by less than the headline rate, the small rise likely reflecting the early impact of the harvest season, which began in September. Core inflation (+40bps to 17.60% y/y) rose to its highest level in five years, given the pressures on energy costs and on the currency.

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