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Oil prices gain despite hike in Fed rate

Brent price (Bonny light) rose to approximately $77.18pb due to a favourable US job data report, which offset recessionary fears, as the US Fed hiked interest rates further. We expect a bearish outlook for oil prices in the near term, in light of the unexpected build in US crude inventories and the uncertainty surrounding the OPEC+ meeting scheduled to hold on April 3rd, 2023.

Bank of England (BOE) and US Fed maintain tight monetary stance

The Bank of England raised its key policy rate by 25bps to 4.25%p.a. in March 2023 alongside the US Fed which did the same. The BOE was responding to inflation data of 10.4% the highest level in 14 years. This could spur investor demand for safe assets such as gold and weigh on the demand for oil. However, we expect a slow and modest rate hike in the near term as the central banks aim to tame inflation and maintain financial stability.

Domestic cocoa season set to improve

Rainfall is expected to boost domestic production for Nigeria’s midcrop cocoa 2022-2023 season. The rise cocoa output could bolster export earnings, government revenue and farmer’s income. Nigeria still expects to trade 240,000 tonnes in the 2023-2024 season.

The download gives a snapshot of the discussion in the commodities segment of the Business Morning Programme on Channels TV.

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