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Nigeria_Fixed Income Daily: Markets trade cautiously ahead of MPC vote
Market commentary
- Despite tighter system liquidity following yesterday’s OMO auction, the interbank Call rate moderated 359bps to 17.6%. At the FX Interbank spot market, the Naira appreciated
N2.45 to NGN307.98/USD.
- In anticipation of next week’s MPC decision, the T-bills market traded mixed with yields inching higher by a marginal 3bps on average. Whilst sell pressure was evident on the 167DTM (+506bps) bill, we observed modest buying on a few short dated maturities with the 13DTM (-77bps), 20DTM (-336bps) and 90DTM (-66bps) bills closing at 14.29%, 12.49% and 13.49% respectively. Yields in the bond market declined 4bps on average amidst modest interest around the mid dated maturities. Particularly, yields on the 15.54% FGN FEB 2020, 14.50% FGN JUL 2021, and 14.20% FGN MAR 2024 declined 17bps, 12bps and 34bps to close at 15.40%, 15.05% and 15.17% respectively.
- Ahead of the upcoming MPC decision, we anticipate a relatively tepid sentiment across the fixed income market as market participants trade cautiously.
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