E-Financial
Naira Steady Ahead of FOMC Meeting, Oil Pushes Higher
Lukman Otunuga, Research Analyst at FXTM,
The Nigerian Naira was basically flat on the forward markets, despite the Dollar depreciating on expectations that the Federal Reserve will be adopting a dovish stance this week.
Investors with an interest in the Naira will be closely monitoring the FOMC meeting this week, which has the potential to impact the emerging market currency. Buying sentiment towards the Naira is likely to jump if the Federal Reserve adopts a dovish stance towards rates and expresses concerns over the US economy.
The Naira also remains influenced by Oil prices, as a fair chunk of Nigeria’s export revenues come from Oil sales. Although rising Oil prices will be a welcome development for the Naira in the near-term, the currency’s outlook remains impacted by domestic conditions at home and geopolitical risk factors across the globe. The next major event risk for the Nigerian economy will be in Central Bank of Nigeria’s interest rate decision next Tuesday. Will the CBN drop hints of a possible rate cut some time in the future? This is a question on the minds of investors.
Brexit chaos deepens as Commons Speaker derails third vote on May’s deal
The British Pound fell yesterday afternoon after the House of Commons Speaker John Bercow essentially banned Theresa May’s Brexit deal from getting a third vote. Although prices later recovered, this once again highlights the tremendously fluid Brexit equation that markets have to contend with. Now, all eyes turn to the summit in Brussels on Thursday, where EU leaders will have their say on an extension to Brexit. It’s key to note that the extension has to be unanimously agreed upon by all 27 member nations before a no-deal Brexit can be safely removed from the table; should just one of the EU members reject reasons for the deadline extension, the Pound will most likely find itself exposed to significant downside risks.
With the prolonged moving nature and fluidity of the Brexit situation weighing heavily on sentiment, Sterling remains at risk of unwinding its year-to-date gains. Still, the base case that markets are pricing in is one of a delayed Brexit, which may only happen in 2020. However, as we have learned in recent weeks more time may not wholly be a good thing, as it could also bring about extended periods of uncertainty and potentially more permutations to the final Brexit outcome. Barring any more surprises, expect the Pound to trade range-bound this week.
Commodity spotlight – WTI Oil
WTI Crude found comfort near its highest levels so far this year, after OPEC+ assured markets that its members will stick to the output cuts through the first half of 2019. Saudi Energy Minister Khalid Al-Falih says there remains a “significant glut” in global supplies which still needs to be drawn down before considering scaling back on production cuts, a move that’s supportive of Oil prices. OPEC+ producers need to demonstrate unified efforts in their attempts to rebalance the Oil markets and to have any chance of offsetting record US Shale production.
Between now and the OPEC meeting scheduled to take place in Vienna in June, markets will certainly be closely monitoring indicators on global supply and demand. With US shale production still robust as ever, oversupply fears are likely to linger in the background. However, sanctions on other Oil producers, namely Iran and Venezuela, may sooth such concerns. Meanwhile on the demand side, should global growth show more obvious signs of faltering, this may open up more downside for Oil.
Financial Derivatives Company (FDC) Limited, a premier economic think-tank and financial advisory firm, led by Bismarck Rewane, has reported that Nigerians have accumulated an estimated $59 billion in cryptocurrency holdings.
Bismarck Rewane
According to data released by the firm highlights the country’s emergence as one of Africa’s and the world’s major players in digital assets.
The earlier disclosure reflects a profound shift in Nigeria’s financial landscape.
In Africa’s largest economy, crypto has moved from a fringe activity to a mainstream tool amid persistent inflation and naira volatility.
Citizens and businesses are increasingly turning to dollar-pegged stablecoins and decentralised platforms, building a parallel financial system with significant economic influence.
Nigeria continues to rank among global leaders in adoption.
According to Chainalysis’ 2024 Global Crypto Adoption Index, the country placed second worldwide for grassroots adoption, driven by widespread use in everyday transactions and cross-border commerce.
Despite these impressive statistics, a notable contradiction remains in public perception.
While stocks, real estate, mutual funds, and foreign currency are openly discussed, many Nigerians still approach cryptocurrency with caution, often downplaying their involvement.
Crypto assets, or cryptocurrencies, are digital assets utilizing cryptography, peer-to-peer networking, and distributed ledger technologies (like blockchains) to secure, verify, and record transactions.
Unlike traditional fiat currencies issued by central banks, these assets operate without central intermediaries, functioning globally as alternative stores of value or transactional mediums.
Flutterwave, an African-founded payments technology company, has partnered with Xoom, PayPal’s international digital money transfer service, to enable faster international money transfers into Nigeria.
The partnership connects Xoom’s global money transfer network with Flutterwave’s local payout infrastructure, allowing customers worldwide to send funds directly to Nigerian bank accounts with local settlement in naira.
Under the arrangement, Flutterwave converts Xoom transfers and settles them locally, enabling recipients to receive funds directly into accounts held at Access Bank, United Bank for Africa, Zenith Bank, First Bank of Nigeria, Guaranty Trust Bank and other participating banks.
Nigeria is one of Sub-Saharan Africa’s largest remittance recipients, receiving more than $20 billion in personal remittances in 2024. However, international payments have historically been affected by foreign exchange constraints and settlement delays.
Flutterwave said the partnership aims to address those challenges by combining Xoom’s international reach with its local compliance capabilities and banking partnerships to simplify cross-border money transfers into Nigeria.
Xoom enables consumers to send money, pay bills and top up mobile phones in approximately 160 markets worldwide as part of PayPal’s global payments ecosystem.
“Millions of Nigerians rely on money from abroad to support everyday needs, whether it’s families receiving help from loved ones, freelancers getting paid for their work, or individuals earning income from the global economy,” said Olugbenga Agboola, founder and CEO of Flutterwave.
“This partnership makes it easier and more reliable for people in Nigeria to receive funds and stay connected to opportunities beyond borders.”
The collaboration expands Flutterwave’s cross-border payments infrastructure and strengthens access to international remittance services in one of Africa’s largest payments markets.
The Securities and Exchange Commission (SEC) has unveiled plans to make sustainability reporting mandatory for large public interest entities from 2027 as Nigeria moves to align its corporate disclosure framework with global environmental, social and governance (ESG) reporting standards.
The phased implementation will begin with voluntary adoption by early adopters and large public interest entities before becoming mandatory in 2027. The requirement will extend to other public interest entities in 2028 and small and medium-scale enterprises (SMEs) by 2030.
Dr Emomotimi Agama, Director-General of the SEC, disclosed this at the 2026 Financial Institutions Training Centre (FITC) Sustainability and ESG Conference 3.0 in Lagos, themed ‘Building a Sustainable Africa: Integrating Environmental Stewardship, Social Investment, and Strong Governance for a Prosperous Future’.
Agama said Nigeria’s sustainability disclosure regime is being aligned with the International Sustainability Standards Board (ISSB) framework, including IFRS S1 and IFRS S2, which have emerged as the global benchmark for sustainability reporting.
He said that institutional investors increasingly consider ESG performance a key determinant of capital allocation rather than a peripheral corporate responsibility issue, noting that the price of entry is disclosure.
He said the reforms would strengthen investor confidence and position Nigerian businesses to access global capital markets, where sustainability disclosures are becoming an essential investment requirement.
According to him, Nigeria’s capital market has recorded significant expansion, with market capitalisation growing from about N130 trillion to nearly N160 trillion following recent market reforms, while assets under management have surpassed N9 trillion.
To deepen sustainable finance, Agama said the commission was promoting infrastructure, green and municipal bonds, alongside infrastructure-focused investment funds, to mobilise long-term capital for critical national projects.
He added that the SEC would also encourage investments in the blue economy and support financing for the power sector through green energy bonds, project bonds and public-private investment structures.
The SEC chief cited the recent launch of the Nigerian Exchange (NGX) Impact Board as another milestone in advancing sustainable finance and urged companies, regulators and investors to move beyond commitments by embedding sustainability into governance, operations and investment decisions.
Managing Director and Chief Executive Officer of the Financial Institutions Training Centre (FITC), Dr Chizor Malize, said sustainability and ESG had evolved from compliance issues to core drivers of business competitiveness, investment decisions and economic development.
She said the conference, now in its third edition since 2024, had become a leading platform for advancing sustainability discourse in Africa, adding that this year’s gathering was designed to move stakeholders “from conversation to commitment”.
Chairman of the FITC Advisory Board, Prof Fabian Ajogwu, described governance as the foundation of sustainable development, arguing that Africa must become a standard-setter rather than merely adopting frameworks developed elsewhere.
Although Africa contributes less than four per cent of global greenhouse gas emissions, he said, the continent bears a disproportionate share of climate-related impacts, including worsening floods and increasingly erratic weather patterns.
Ajogwu also cited estimates that poor governance costs Africa between $88 billion and $90 billion annually, while highlighting technology-driven agricultural initiatives, including a partnership involving Morocco’s OCP Group and the Nigeria Sovereign Investment Authority (NSIA), as examples of practical models that should be replicated across the continent.
Delivering the keynote address, Chairman of the MTN Nigeria Foundation, Mosun Belo-Olusoga, said the debate over the relevance of sustainability and ESG had ended, with the real challenge now centred on implementation.
She observed that global investors increasingly evaluate businesses on governance quality, resilience and their ability to manage environmental and social risks, in addition to profitability.
Belo-Olusoga noted that despite contributing the least to global carbon emissions, Africa possesses vast arable land, abundant renewable energy resources and critical minerals required for the global energy transition.
She identified four leadership priorities for the continent: shifting from short-term performance to long-term value creation, replacing corporate philanthropy with strategic social investment, moving beyond regulatory compliance to responsible leadership, and strengthening collaboration among governments, businesses and development partners.
She also outlined five priorities for Africa’s ESG agenda over the next decade, including embedding sustainability into corporate strategy and governance, investing in human capital, mobilising indigenous capital through instruments such as green bonds and pension funds, strengthening institutional accountability, and fostering partnerships in renewable energy, digital technology and climate-smart agriculture.
“The defining challenge before Africa is not a shortage of vision; it is execution,” Belo-Olusoga said, urging governments to create enabling policies, businesses to integrate ESG into enterprise risk management, and financial institutions to develop innovative financing mechanisms that support a green and inclusive economy.
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