GLOBAL ECONOMY
The US economy expanded by 2.10% annualized in Q1 2026, up from the previous estimate of 1.60% and 0.50% in Q4 2025, driven by stronger business investment and a smaller drag from net exports. However, consumer spending slowed sharply to 0.50% from 1.40%, reflecting weaker demand for services. Inflationary pressures remained elevated in May as headline Personal Consumption Expenditures (PCE) inflation accelerated to 4.10% year-on-year (y-o-y) from 3.80%, marking its highest level since April 2023, while monthly PCE inflation held steady at 0.40% month-on-month (m-o-m). Core PCE, the Federal Reserve’s preferred inflation measure, increased 0.30% m-o-m for the second consecutive month, with annual core inflation rising to 3.40% y-o-y from 3.30%, its highest level since October 2023. Additionally, Q1 2026 core PCE inflation rose 4.40% quarter-on-quarter (q-o-q), up from 2.70% in Q4 2025, highlighting persistent underlying price pressures. The continued rise in inflation supports the Federal Reserve’s cautious stance on policy easing.
UK private sector activity remained in contraction for a second consecutive month, with the Composite Purchasing Managers Index (PMI) falling to 49.40 in June from 49.70 in May, below market expectations of 50.60. The weakness was driven by the services sector, where the Services PMI declined to 48.70 from 49.30, its lowest level since January 2023, reflecting subdued customer demand and persistent cost pressures. Meanwhile, the Manufacturing PMI eased to 53.10 from 53.90, although manufacturing output improved to 53.60 from 52.20, supported by temporary stockpiling ahead of expected price increases. While input and output price pressures moderated for a second consecutive month, employment continued to decline amid weak demand and higher labour costs.
Eurozone business activity showed signs of stabilization in June, with the Composite PMI rising to 49.50 from 48.50 in May, its highest level in three months, as contractions in the services sector eased. The Services PMI improved to 48.90 from 47.70, while the Manufacturing PMI edged down to 51.30 from 51.60 but remained in expansionary territory for a fifth consecutive month. Although new orders and employment continued to decline, business confidence improved for a second straight month. Inflationary pressures also moderated, with both input costs and output prices rising at a slower pace.
The People’s Bank of China (PBoC) left its key lending rates unchanged for a 13th consecutive month in June, keeping the 1-year Loan Prime Rate (LPR) at 3% and the 5-year LPR at 3.50%, as policymakers balanced slowing domestic demand against rising inflationary pressures linked to higher energy costs and Middle East-related supply disruptions. Economic data remained mixed, with retail sales unexpectedly contracting in May, while industrial production accelerated and Yuan loan growth rebounded after April’s decline. Meanwhile, signs of weakness in external and property-related sectors persisted. Foreign Direct Investment (FDI) declined by 8.60% y-o-y in May, although this marked an improvement from the 10.30% contraction recorded in April, while housing prices continued to fall amid ongoing property sector challenges.
Next week, economies will remain focused on developments in US-Iran peace negotiations, with any progress likely to influence global risk sentiment, energy markets, and inflation expectations.
GLOBAL MARKETS
US equities closed mixed, as stronger-than-expected economic growth and a resilient labour market were overshadowed by rising inflation, reinforcing expectations that the Federal Reserve could keep interest rates higher for longer. Compared to last week, the Nasdaq and S&P 500 indices decreased by -4.24% and -1.95% to 29,118.24 and 7,354.02, while the Dow Jones index increased by 0.60% to 51,876.11.
European markets were supported by easing energy prices and moderating inflation pressures, although gains were capped by weak PMI data and concerns over slowing economic activity across the Eurozone. Compared to last week, the DAX and CAC40 indices decreased by -1.26% and -0.43% to 24,671.22 and 8,384.87, while the FTSE 100 index increased by 1.04% to 10,508.02.
Asian markets ended lower as a selloff in technology and AI-related stocks weighed on sentiment, while expectations of tighter monetary policy in Japan added further pressure to regional equities. Compared to last week, the Hang Seng and Topix indices decreased by -5.24% and -2.02% to 22,671.86 and 3,963.36, respectively.
Next week, Global markets will monitor the flow of tankers and commercial vessels through the Strait of Hormuz, as smoother tanker flows could keep oil prices lower, while any disruptions may trigger renewed energy market volatility.
DOMESTIC ECONOMY
Nigeria Draws First Tranche of $5billion UAE Financing Facility
Nigeria drew the first tranche of its planned $5billion financing facility from UAE-based First Abu Dhabi Bank (FAB), marking a key step in the Federal Government’s strategy to secure lower-cost foreign funding amid elevated global borrowing costs. The facility, structured as a Total Return Swap (TRS), will support the implementation of the 2026 budget, finance critical infrastructure projects, and refinance existing debt obligations. The arrangement was approved by the National Assembly in April as part of the government’s broader external borrowing programme aimed at reducing financing costs and easing pressure on public finances. However, the IMF has cautioned that derivative-based financing structures may pose transparency and risk management challenges despite offering access to cheaper funding.
S&P Global Raises Nigeria’s Inflation Forecast, Cuts Growth Outlook
S&P Global has revised its outlook on Nigeria’s economy, raising its 2026 average inflation forecast to 16.90% from 15%, while lowering its GDP growth projections to 3.70% for 2026 and 3.50% for 2027, from previous estimates of 4% and 3.80%, respectively. The ratings agency attributed the upward revision in inflation to stronger-than-expected pass-through of higher global oil prices to domestic energy costs, as well as expectations of rising food inflation driven by elevated transportation and fertilizer costs. According to S&P Global, persistent inflationary pressures are expected to weigh on household consumption, Nigeria’s largest driver of economic activity, prompting the downgrade to its growth outlook. The agency noted that Nigeria recorded the largest upward inflation revision among key emerging markets in the Europe, Middle East and Africa (EMEA) region. Consequently, S&P expects the Central Bank of Nigeria (CBN) to maintain a tight monetary policy stance, with interest rates remaining elevated through 2026.
Dangote Refinery Cuts Petrol Price Amid Decline in Global Oil Prices
Dangote Petroleum Refinery reduced its ex-depot petrol price by ₦50 per litre to ₦1,125/litre from ₦1,175/litre, marking the latest in a series of price cuts driven by declining global crude oil prices. The adjustment followed easing geopolitical tensions in the Middle East, which pushed Brent crude and WTI prices down, reducing feedstock costs for refiners. The refinery also lowered its coastal supply price to ₦1.43million per metric tonne from ₦1.50million. The price reduction is expected to ease pressure across the downstream petroleum market and could support lower retail fuel prices in the coming weeks. It also reinforces Dangote Refinery’s growing influence on fuel pricing dynamics in Nigeria’s deregulated market, where its pricing decisions increasingly serve as a benchmark for other marketers.
CBN Data Shows Sharp Rise in Credit to Government
Credit to the government rose by ₦17.39trillion y-o-y to ₦40.38trillion in May 2026, representing a 2% increase from April, according to CBN data. In contrast, credit to the private sector increased at a slower pace to ₦81.04trillion, highlighting the growing preference of banks for government-related assets. The trend reflects the attractiveness of government securities in the current high-interest-rate environment, where risk-free returns remain elevated following the CBN’s decision to maintain the Monetary Policy Rate (MPR) at 26.50%. While this has supported government financing, concerns persist that increased lending to the public sector could crowd out private-sector credit, limiting access to funding for businesses and potentially moderating economic growth.
Nigerians Hold ₦5.19trillion Outside the Banking System
Cash held outside the banking system rose to ₦5.19trillion in May 2026, up by ₦109.34billion (2.18% m-o-m) from ₦5.08trillion in April, underscoring the continued preference for cash transactions despite ongoing efforts to promote digital payments and financial inclusion. Meanwhile, currency in circulation increased to ₦5.69trillion in May from ₦5.65trillion in April, representing a 0.71% monthly increase and a 13.34% y-o-y rise from ₦5.02trillion recorded in May 2025. The data suggests that a significant proportion of cash released into the economy remains outside the banking sector. In response, the CBN continues to push its cashless policy agenda, aiming to reduce cash held outside banks to below 40% of total currency in circulation through the deployment of over 10 million QR-code and tap-to-pay acceptance points across the country.
Next week, Investors will closely monitor the release of the June 2026 PMI data for insights into the health of Nigeria’s private sector, particularly the performance of the manufacturing sector and overall business activity.
EUROBOND MARKET
Eurobond markets posted a positive performance during the week as easing geopolitical tensions and falling oil prices boosted demand for fixed-income assets. Investor sentiment was supported by lower energy-driven inflation risks, prompting a rally in sovereign bonds and a modest decline in yields across major markets. However, gains were tempered by elevated inflation readings in the US, which reinforced expectations that major central banks could maintain a cautious policy stance.
Next week, Global Eurobond performance next week will be driven by inflation expectations, central bank policy signals, and developments in US-Iran negotiations.
ALTERNATIVE ASSETS
GOLD
Gold extended its decline during the week, with prices falling to around $4,079/oz as easing geopolitical tensions in the Middle East reduced safe-haven demand. The stronger US inflation outlook and expectations of higher-for-longer interest rates also weighed on bullion, while investors shifted toward risk assets following progress in the US-Iran peace process. Gold is down roughly 3.40% w-o-w, marking its third consecutive weekly decline.
OIL
Oil prices recorded sharp losses during the week as concerns over supply disruptions continued to ease. Brent crude settled at $71.99/bbl, down 10.90% w-o-w, while WTI closed at $69.23/bbl, down 9.60% w-o-w. The decline was driven by increased tanker traffic through the Strait of Hormuz, the resumption of crude loadings at Saudi Arabia’s Ras Tanura terminal, and growing expectations of a near-term supply surplus.
ETF
Major ETFs recorded mixed performance during the week, with equity and bond ETFs remaining relatively supported by improved risk sentiment, while commodity and energy ETFs came under pressure amid declining gold and oil prices. Investors continued to balance resilient economic data against evolving geopolitical and interest rate expectations.
Gold may remain subdued amid easing geopolitical risks and expectations of higher-for-longer interest rates. Oil prices will be shaped by developments in US-Iran negotiations and shipping flows through the Strait of Hormuz, while ETF demand is expected to remain supported by continued investor preference for equities and fixed-income assets.
DOMESTIC MARKETS
MONEY MARKET AND FIXED INCOME
Money market liquidity remained robust during the week despite the CBN’s liquidity mop-up activities. System liquidity opened at ₦4.40trillion, supported by OMO maturities, while a ₦2.10trillion OMO auction and ₦1.20trillion FGN bond settlement partly offset inflows. However, the impact was mitigated by ₦600billion in maturing OMO bills, leaving liquidity comfortable at ₦4.10trillion at weekend, compared to ₦3.98trillion in the previous week. Consequently, the Overnight Financing Rate (NOFR) remained unchanged week on week at 22.00%, while the Overnight (O/N) rate inched up by 3bps to 22.23% from 22.20%.
Activity in the secondary Treasury bills market remained bearish throughout the week, as the average yield increased week-on-week by 52bps to 18.67%. The Bonds market followed the bearish pattern with yields closing higher, as the average bond yield rose by 77bps to close at 17.78%.
Next week, we expect cautious trading as Investors assess liquidity conditions and monetary policy expectations.
EQUITIES MARKET
The Nigerian equities market extended its bearish momentum as the NGX All-Share Index and Market Capitalization depreciated by 1.65% and 1.60% to close at 232,049.02 and ₦148.91trillion respectively compared to 235,941.27 and ₦151.33trillion last week.
A total turnover of 2.32 billion shares worth ₦134.49billion in 249,328 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 3.08 billion shares valued at ₦254.61billion that exchanged hands last week in 287,157 deals.
On a sectoral basis, major sectors closed negative, as the Oil and Gas, Insurance, Consumer Goods and Industrial Goods indices fell by -9.86%, -4.39%, -1.53% and -8.21%. The Banking index was the sole gainer, posting a gain of 3.51% w-o-w.
Notable gainers this week were Mcnichols Plc and International Energy Insurance PLC while Trans-Nationwide Express PLC and Deap Capital Management & Trust PLC topped the losers list.
We expect the Nigerian equities market to trade cautiously in the near term as investors balance profit-taking in stocks that have recorded strong year-to-date returns, with bargain hunting in fundamentally strong counters.
CURRENCY
| (₦/$) | 26/06/2026 | 19/06/2026 | W-O-W% |
| NAFEM | 1,380.93 | 1,370.46 | 0.76% |
| Parallel | 1,395.00 | 1,390.00 | 0.36% |
TOP GAINERS
| TICKER | OPEN | CLOSE | CHANGE | % |
| MCNICOLS | 6.80 | 8.60 | 1.80 | 26.47% |
| INTENEGINS | 5.06 | 5.79 | 0.73 | 14.43% |
| GTCO | 115.55 | 127.90 | 12.35 | 10.69% |
| FIRSTHOLDCO | 55.00 | 60.50 | 5.50 | 10.00% |
| AIRTELAFRI | 3,962.60 | 4,358.80 | 396.20 | 10.00% |
TOP LOSERS
| TICKER | OPEN | CLOSE | CHANGE | % |
| TRANSEXPR | 4.48 | 3.28 | -1.20 | -26.79% |
| DEAPCAP | 4.89 | 3.75 | -1.14 | -23.31% |
| ABBEYBDS | 10.10 | 8.05 | -2.05 | -20.30% |
| ARADEL | 1.750.00 | 1,417.50 | -332.50 | -19.00% |
| REGALINS | 0.97 | 0.79 | -0.18 | -18.56% |
DISCLAIMER
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