Nigeria_Fixed Income Daily: Bears assume pole position amidst constrained liquidity.
- Market commentary
§ At the FX interbank market, the naira remained unchanged at N305.00 and N378.00 against the dollar for the spot rate and one year forward rate respectively. Meanwhile, Interbank Call rose 708bps to 15% following yesterday’s N223 billion liquidity OMO mop up.
§Bearish sentiment enveloped the fixed income market today as yields trended upwards on both bills and bonds. Yields in the T-bills market rose 33bps on average amidst strong sell pressure on short-dated maturities. Specifically, yields on the 23DTM (+104bps) and 72DTM (+126bps) bills climbed to 13.21% and 11.52% respectively. Similarly, yields on benchmark bonds rose 7bps on average, with larger advances at the short end of the space. Yields on the 7.00% FGN OCT 2019 and 15.54% FGN FEB 2020 bonds rose 9bps and 15bps to settle at 16.43% and 16.51% respectively.
§ We expect recent liquidity mop up to further constrain buying in tomorrow’s trading session.
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