February 3, 2020

Coronation Report

Nigeria is the world’s best-performing stock market this year (see page 2). Foreign portfolio investment is confidently investing in Naira-denominated fixed income (see below). What is going wrong? Fear over the coronavirus dampens oil prices. The Cash Reserve Ratio (CRR) of the banks has been raised from 22.5%to 27.5% (see last week’s Update). Our advice is not to panic. Economies recover from disasters. Banks will make a little less money than we imagined but still benefit significantly from falling interest rates.

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