Nigeria_Fixed Income Daily: Modest demand buoys bond space
- Market commentary
§ Amidst relatively unchanged system liquidity, Interbank call rate rose 41bps to close at 11.33%. Meanwhile, the naira appreciated N0.25 against the dollar at the spot market to close at N305.00 while remaining unchanged at N349.00 on the one year forward rate.
§The T-bills market closed the week mixed as yields crept up a mild 2bps on average. Whilst yields on the 27DTM (+59bps) and 209DTM (+43bps) bills rose to 13.13% and 20.07% respectively, yields on the 181DTM (-67bps) and 300DTM (-31bps) bills declined to 18.58% and 20.63% respectively. In contrast, we observed healthy demand in the bond market at week close as yields fell 6bps on average. Highlighting the performance of the bonds on offer at this month’s auction, yields on the 14.50% FGN 2021, 12.50% FGN JAN 2026, and 12.40% FGN MAR 2036 bonds moderated 8bps, 8bps, and 5bps respectively to close at 16.46%, 16.68%, and 16.77% respectively.
§ We expect investors to cherry-pick across the curve in anticipation of next week’s primary market auctions (bills and bonds).
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