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Business News

U.S dollar gains, America sanctions Chinese Airlines from flying into the U.S.

Nigerians hoping for transactions via the U.S dollar to countries like France would have the need to pay fewer dollars to fulfill such transactions. 

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dollar foreign debt, Foreign investors trapped in the debt market as dollar scarcity persists, U.S dollar gains, America sanctions Chinese Airlines from flying into the U.S. , U.S dollar gains, America sanctions Chinese Airlines from flying into the U.S., U.S Dollar Remains Firm, Global Investors Rush Into Safe Haven Assets

The American dollar was up on Thursday morning based on global investors returning to the safe-haven asset as America-China tensions strengthened exponentially.

The American Dollar Index that checks the U.S dollar against a basket of other major currencies such as (Japanese yen, Euro, British pounds sterling, Swedish krona, Canadian dollar, Swiss France) was up 0.21% to 99.46 by 5:30 am Nigerian local time.

The U.S dollar index also helps to track the strength of the currency in correlation to the biggest forex trading partners around the world. 

What it means: Nigerians hoping to meet foreign exchange debt or payment obligations, transactions via the U.S dollar to countries like France, United Kingdom, Australia, Germany Japan, would have the need to pay fewer dollars to fulfill such transactions.

READ ALSO: Bulls boost global financial markets as gold hits 7-year high

The political fundamentals among these major powers turned ugly as the U.S government suspended Chinese airlines’ flight from flying into the U.S coming to effect from June 16 after the Chinese barred U.S carriers from re-entering China.

U.S dollar gains, America sanctions Chinese Airlines from flying into the U.S.

Relations between the two countries soured after China’s approval of the enactment of national security laws in Hong Kong and Macau last month.

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Hong Kong’s Legislative Council passed a national anthem bill, a precursor to the national security laws, earlier in the day.

READ MORE: Nigeria’s food security, GDP growth hinge on financial inclusion of farmers

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According to a recent poll conducted by Reuters, the majority of currency experts believe that there was an elevated risk that the US-China tensions will renew safe-haven bets in the next 6 months, meaning the dollar could resume its bullish momentum in the mid-term.

The report from the poll concluded that:

 “More than 70% of 57 currency analysts said the risk was “high” that the U.S.-China standoff would renew bets in favor of safe-haven currencies over the next six months. 

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“International rates to borrow dollars on cross-currency basis swaps, which were extremely high in mid-March, have hit low levels, with the latest euro-dollar three-month swaps rate suggesting it has become more costly to borrow the euro instead.” 

 

 

Olumide Adesina is a France-born Nigerian. He is a Certified Investment Trader, with more than 15 years of working expertise in Investment trading. Message Olumide on Twitter @tokunboadesina. He is a Member of the Chartered Financial Analyst Society.

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Macro-Economic News

BREAKING: Nigeria’s inflation rate surges to 18.17% in March 2021

Nigeria’s inflation rate for the month of March 2020, rose to 18.17% from 17.33% recorded in February 2021.

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Nigeria’s inflation rate for the month of March 2020, rose to 18.17% from 17.33% recorded in February 2021.

This is according to the Consumer Price Index report, recently released by the National Bureau of Statistics (NBS).

Food inflation spikes to 22.95% from 21.79% recorded in the previous month, while core inflation, which excludes the prices of volatile agricultural produce rose to 12.67% from 12.38% recorded in February 2021.

 

More details shortly…

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Business News

BUA Group, French company announce progress in 200,000 bpd refinery project

This is coming about 6 months after both firms signed an agreement for the supply of process technologies and the design of the facility.

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The BUA Group and Axens, a French-based petroleum technology company, have both signed a progress acknowledgement statement for the proposed BUA multi-billion-dollar integrated 200,000 barrels per day refinery in Akwa Ibom State.

This is coming about 6 months after both firms signed an agreement for the supply of process technologies and the design of the facility.

BUA, while making the disclosure in a statement on Wednesday, April 14, 2021, said that the French President, Emmanuel Macron, commended its Chairman, Abdul Samad Rabiu, for his commitment to developing lasting relationships between French and Nigerian businesses.

READ: What the $1.5 billion Port Harcourt refinery deal means to us – Maire Tecnimont

The statement said that this came as the French Minister for Foreign Trade and Economic Attractiveness, Franck Riester, paid a visit to the BUA Group Headquarters in Lagos where he handed over a personal invitation from Macron to Rabiu to attend the Choose France Summit in June in Paris representing business leaders from Nigeria and Africa.

The French minister also witnessed the signing of a progress acknowledgement statement between BUA Group and Axens of France for the proposed refinery project, according to the statement.

The statement also said that during the visit, it was announced that the BUA chairman had been appointed Chairman of the France Nigeria Investment Club.

READ: FG reacts to reports of revoking 32 refinery licenses

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While thanking the minister and Macron for their unwavering support in bringing BUA and French businesses together, Rabiu said BUA had so far initiated partnerships and had developed personal relationships with a few French businesses, including Axens.

He expressed confidence in the quality of expertise and technical know-how of the French companies BUA had partnered with.

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Rabiu pointed out that the BUA refinery would reduce the huge cost of transporting Nigerian crude offshore, refining it and bringing it back into the country when fully operational.

READ: Abdulsamad Rabiu’s stake in BUA Cement has increased by N1.2 trillion in value since listing in 2020

He said that the choice of Akwa Ibom for the refinery was due to the huge availability of raw materials and its proximity to export petroleum products to regional countries.

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The President of Axens, Jean Sentenac, in his statement, said he was pleased that the project was advancing on schedule and expressed delight for the very good cooperation between all the involved parties, reiterating the commitment of Axens in delivering the BUA Refinery Project on time and with the highest standards.

READ: FG to open LPG distribution channels in all local governments

Bottom line

The completion and take-off of the refinery owned by the BUA Group would come as a huge boost for the Federal Government’s effort to stop the importation of refined petroleum products, ensuring that the country becomes a net exporter of these products.

This will also help to conserve the scarce foreign exchange as the completion and take-off of the Dangote refinery and other similar refinery projects will help ensure self-sufficiency in the country.

The BUA Group, just a few days ago, was listed as one of the companies with an active refinery license from the Department of Petroleum Resources (DPR).

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