Welcome to Nairametrics‘ summary of the daily performance of major economic indicators and highlights from trading sessions and key statistics such as Treasury Bills and Bonds. This is brought to you by Zedcrest.
This report is dated May 24th, 2019.
*** FG set to issue N15bn Green Bond*** – DMO
Key Indicators
Bonds: The FGN Bond market reversed all its previous session gains, with yields trending higher by c.11bps on the day, due to the resumption in OMO sales by the CBN, which lifted yields higher in the T-bills market.
We expect bond yields to be relatively stable in the near term, with slight demand interests expected to support yields at current levels.
Treasury Bills: The T-bills market remained bearish, with yields trending higher by c.30bps in reaction to the resumption in OMO sales by the CBN in the previous session. The selloffs were however subdued by the release of FAAC payments by the FG, which bolstered system liquidity and alleviated pressures from the retail FX and bond auction outflows in the money market.
Opening the new week, we expect T-bill rates to remain relatively stable, barring a further OMO sale by the CBN.
Money Market: Rates in the money market inched slightly higher by c.2pct, due to the retail FX and bond auction outflows from the system. The OBB and OVN rates consequently ended the session at 11.14% and 12.00%, as inflows from FAAC payments bolstered system liquidity to c.N150bn est.
We expect rates to trend higher opening the new week, as banks fund for the weekly wholesale FX auction by the CBN.
FX Market: At the Interbank, the Naira/USD rate was unchanged at N306.90/$ (spot), and N356.92/$ (SMIS). The NAFEX closing rate in the I&E window however declined further by 0.04% to N360.39/$, whilst the market turnover declined by 37% to $217m. At the parallel market, the cash rates decreased by 0.02% to N359.00/$, while the transfer rate remained unchanged at N363.50/$.
Eurobonds: The NIGERIA Sovereigns remained slightly bearish, with yields higher by c.6bps on the day, and the most selloff now witnessed in the belly of the curve.
Interests remained firm in the NIGERIA Corps, with slight gains witnessed across most traded tickers. The FIDBAN 22s and ETINL 24s remained the outperformers amongst the pack.
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Whilst proper and reasonable care has been taken in the preparation and accuracy of the facts and figures presented in this report, no responsibility or liability is accepted by Zedcrest Capital or its employees for any error, omission or opinion expressed herein. This report is not an investment research or a research recommendation and should not be regarded as such. The information provided herein is by no means intended to provide a sufficient basis on which to make an investment decision.