Nigeria_Fixed Income Daily: Markets turn bullish
Market commentary
§Interbank Call rate rose further in today’s session, up 125bps to 20.83%. At the FX interbank market, the naira depreciated N4 to close at N315.06.
§Following slightly lower yields from yesterday’s PMA, the T-bills market turned bullish today as yields converged towards auction levels, down 41bps on average. The most notable yield declines were observed on the 28DTM (-216bps), 91DTM (-108bps), and 126DTM (-84bps) bills to close at 15.01%, 15.34%, and 16.73% respectively. The bond market also traded bullish as yields moderated 19bps on average, driven by buoyant demand on the short end of the space. Particularly, yields on the 15.10% FGN APR 2017, 9.85% FGN JUL 2017, and 9.35% FGN AUG 2017 declined by 53bps, 31bps, and 26bps to close at 20.04%, 21.10%, and 20.96% respectively.
§Whilst we note the upbeat sentiment in today’s trading session, we anticipate a mixed sentiment at week close as market participants cherry-pick across the yield curve.
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