In a new report titled “Risk of Global Recession in 2023 Rises Amid Simultaneous Rate Hikes,” the World bank said the currently expected trajectory of interest-rate increases and other policy actions might tip the global economy into a recession with more significant implications for developing economies. The US Fed has recently raised rates by 75bp to bring the federal funds rate to 3%-3.25%, while the Bank of England (BoE) advanced its hawkish monetary policy by hiking rates by another 50bp to a 14-year high of 2.25%. Analysts believe that unless supply disruptions and labour-market pressures subsided, the global core inflation rate could remain at about 5% in 2023—nearly double the five-year average before the pandemic. On the back of more aggressive rate hikes, however, emerging markets are expected to experience more significant external liquidity problems as debt service cost mounts.
Agricultural experts have developed new maize and cowpea seeds to ensure Nigeria’s self-sufficiency in maize production. They claim the project yielded prolific germination in about 60 different demo sites across Kaduna, Niger, and Kano state with about 10 different varieties of hybrid maize, including Sammaz 62, Sammaz 63, and Sammaz 68 of drought tolerant and high yield seeds. The aim is to pivot Nigeria into becoming Africa’s highest producer of maize. Recall that Nigeria and some other west African countries completed a project earlier this year in the production and testing of the TELA maize, which was claimed to be drought tolerant and resistant to pests like fall armyworm, stem borers with a yield up to 8 tons per hectare compared to the 3 tons per hectare earlier achieved in the country.
As of 2020, South Africa stood as Africa’s highest producer with a total of 15.3m tonnes of maize, and while some unofficial sources have claimed that South Africa Produced about 17m tonnes in the 2021/2022 season, Nigeria has to increase its production of these seeds provided they meet global standard. If Nigerian farmers use these varieties, the country should be able to achieve self-sufficiency in maize production (see chart 1 below)
Clean Energy Jobs Now Account for More than Half of Employment in the Sector.
According to the first World Energy Employment Report from the International Energy Agency (IEA), the hiring in clean energy has increased employment in the energy sector globally above pre-pandemic levels, despite the oil and gas industry still struggling to recover from significant layoffs during the early stages of COVID-19. The report also stated that employment levels exceeded the 65 million workers reported in 2019. Significant new manufacturing facilities, particularly in solar and electric car technologies, which have been operational since 2019, havefostered the expansion of the clean energy workforce. However, the IEA has asserted that, for the world to achieve net-zero emissions by 2050, 14 million new clean energy jobs must be created by 2030. This is a positive development since it paves the way for the worldwide expansion of the renewables industry while guaranteeing a constant rise in employment opportunities and opening new opportunities for economic growth.
NCC-CSIRT Advised Zoom Users to Update Software
Zoom users have been advised by the Nigerian Communication Commission (NCC) Computer Security Incident Response Team to install the latest update of the software from its publisher’s official website after several flaws were found in Zoom products that allow a remote attacker to exploit the app. A remote attacker could use these flaws to join a meeting they were not permitted to attend without being seen by the attendees. This incident in the telecom sector may affect consumers and citizens at large. Analysts believe that the set of the CSIRT by the NCC, with their collaboration with the Nigeria Computer Emergency Response Team (ngCERT) established by the federal government, would help reduce the volume of future computer risk incidents.
NGX Group Experience Huge Selloffs Despite Improved Dividend Pay-Out Policy
Despite the reviewed dividend pay-out policy, the NGX group recorded huge selloffs. The group was the most traded by volume and value yesterday at 30.75m units and N553.54m, respectively. The selloffs pulled down the share price by -2.96% to N18 from N18.55 and a -8.86% decline week-on-week (WoW). Analysts attribute the selloff to the recently released half-year result (See chart 2 below).
Banks Suspend the Use of Naira Debit Card for International Transactions: A Reality of FX-Scarcity
Some Nigerian Banks have suspended using Naira Visa debit cards for international transactions. Standard Chartered Bank implemented the policy on August 1, 2022. Firstbank is about to follow suit at the end of September, with a high possibility that other financial institutions will soon join. At the beginning of the year, most banks reduced the monthly international spending limit from US$100 to US$20 as the FX shortage worsened. The country has been struggling with the shortage of FX for a while as the main dollar-generating commodity (oil) suffers decreasing production output.
The fallback in production has led to a downward trend in the country’s external reserves, depreciating by US$1.37 billion to US$39.16bn in the first half of the year from US$40.52bn as of 2021. The FX shortage has severely weighed on the naira this year, depreciating to a record low of 715 to a dollar at the parallel market in August and mildly at the official window. Analysts expect the upcoming election to further worsen the currency depreciation till the end of the year as politicians aggressively increase spending and people continue to hoard dollars considering its tremendous appreciation so far.
Following the pressure from various experts, the Japanese Authorities succumbed by intervening in the market yesterday for the first time since 1998, in an attempt to support the dwindling currency. The Japanese Yen surged by 4% after the intervention to 140.31 to the dollar from 145.81 recorded in the previous session. With the bank of Japan maintaining its ultra-low policy, the recent appreciation is expected to wear off soon as the hawkish stance of the Fed rate continues to bruise the currency. Analysts expect the BOJ to intervene continuously to shield the currency from recurring losses and sustain the appreciation.
XRP Soared 55.0% Amid Its Legal Dispute with The US SEC
Given the several selloffs near the US$18,000 level for bitcoin and the intense intraday volatility, the global market cap rebounded by +4.04% to US$948.03bn. This was preceded by a slight move away from the oversold territories on the relative strength indicator. In the past 24 hours, Bitcoin increased from US$18,859.75 to US$19,170.55, indicating a positive indicator. Among the major altcoins trading in the positive zone, XRP held strong, with gains of +55.0% and +45.48% over the last 7 and 30 days, respectively, as investors placed a bullish bet in anticipation of a resolution of the ripple lawsuit with the US SEC (see chart 3 below).
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