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Nigeria_Fixed Income Daily: T-bills maintain upbeat at week open
Market commentary
- Â At week open, interbank placement rates moderated marginally amidst a healthy system liquidity (c.
N400 billion), with the Call rate down 33bps to 3.75%. At the FX interbank market, the Naira depreciated 7 kobo to NGN199.05/USD, retracing from an intraday high of NGN198.00/USD.
- As expected, yields in the T-bills market continued to trend lower as the healthy system liquidity remain supportive of demand across most maturities (yields down 32bps on average). The most notable yield declines were recorded on the 24DTM (-81bps), 31DTM (-113bps), and 45DTM (-112bps) bills, closing at 4.03%, 3.85%, and 4.13% respectively. On the other hand, mixed sentiment trailed the bond market at week open as investors cherry picked across most maturities. Whilst yield on the 16.00% FGN JUN 2019 bond declined 8bps to 12.66%, the yield on the 15.10% FGN APR 2017 bond advanced 11bps to 11.59%.
- We expect trading in the T-bills market to remain upbeat in tomorrow’s session (barring an OMO auction) as the relatively robust liquidity continues to support demand. However, we foresee cautious trading in the bond market as participants look ahead to Wednesday’s auction.
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