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Nigeria_Fixed Income Daily: Market bearish as weak data points weigh
Market commentary
- Whilst system liquidity remained fairly tight, Interbank Call rate declined 233bps to 17.7%. At the FX interbank market, the naira appreciated
N1.9 to close atN316.24.
- At the NTB Primary Market Auction, the CBN sold
N212.85 billion across the 91DTM, 182DTM, and 364DTM bills at stop rates of 14.389%, 17.50% and 18.424% (effective yields: 14.92%, 19.17%, 22.57% respectively). Yields in the T-bills market rose a marginal 4bps on average as discouraging economic data released (June Inflation: 17.01%, Q2’16 GDP growth: -2.06%, Unemployment: 13.32%) dampened trading sentiment. Likewise, yields in the bond market climbed 13bps on average as sentiment remained largely tepid across the space. Particularly, yields on the 16.00% FGN JUN 2019 and 14.20% FGN MAR 2024 bonds advanced 26bps and 10bps to 15.33% and 15.16% respectively.
- Whilst we note that the flurry of bleak economic data released today had been widely anticipated, we expect market sentiment to remain largely bearish and foresee more sell pressure particularly around the longer end of the yield curve.
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