- Treasury Bills (T.bills) sold by the Debt Management Office (DMO) increased by 15.41% in May 2023 compared to April 2023.
- The DMO reopened several FGN Bonds in May 2023, which were oversubscribed by 151.46%.
- The secondary market turnover on the FMDQ Exchange saw a significant increase of 25.67% in May 2023, with foreign exchange, money market, and CBN Bills transactions dominating the market.
The Debt Management Office (DMO) sold Treasury Bills (T.bills) valued at N324.43 billion across its auctions in May 2023.
According to the FMDQ Markets Monthly Report for May seen by Nairametrics, the amount represents a 15.41% (N43.33 billion) Month on Month (MoM) increase on the value of T-bills sold across its auctions in April 2023 (N281.10 billion).
The report noted that the DMO re-opened two (2) 10Y, one (1) 20Y, and one (1) 30Y FGN Bonds worth N545.26 billion in May 2023.
The total sale represented a 151.46% oversubscription of the amount offered, and a 1.30% (N7.21 billion) MoM decrease on the amount sold in April 2023 (N552.26 billion) for the same FGN Bond maturities.
FMDQ noted that the CBN did not auction OMO Bills in the primary market for the fifth consecutive month in May 2023.
Corporate bonds
According to the report, the total value of corporate bonds listed on the FMDQ Exchange in May 2023 was N31.00 billion compared to the previous month which witnessed no listings.
- “In the review month, the corporate bond listings emanated from issuers in the Financial Services and Oil & Gas sectors, respectively.
- As a result, the total outstanding value for corporate bonds increased MoM by 1.71% (N27.50 billion) from N1,609.49 billion in April 2023 to N1,636.99 billion in May 2023,” it noted.
Commercial Papers
The report stated that the total value of Commercial Papers (CPs) quoted on the FMDQ Exchange in May 2023 was N163.77 billion, representing an MoM increase of 43.32% (N49.50 billion) from the value of CPs quoted in April 2023.
- “Quoted CPs were issued by institutions from various sectors including Financial Services (17), Agriculture (4), Real Estate (3), Health and Pharmaceuticals (3), Retail (2), Manufacturing (2), and Consumer Staples (1).
- As a result, the total outstanding value of CPs increased MoM by 10.23% from N73.15 billion to N788.43 billion,” it said.
Secondary market turnover
According to the report, secondary market turnover on FMDQ Exchange in May 2023 was N15.78 trillion, representing an MoM and YoY increase of 25.67% (3.22 trillion) and 2.53% (N0.39 trillion) from April 2023 and May 2022 figures, respectively.
It noted that foreign Exchange (FX), Money Market (MM), and CBN Bills transactions dominated secondary market activity in May 2023, accounting for 80.25% of the total secondary market turnover.
- “Total spot market turnover for all products traded in the secondary market was N13.37 trillion in May 2023, representing an MoM increase of 26.21% (N2.78 trillion) from April 2023 figures.
- The MoM increase in total spot market turnover was jointly driven by an improvement in turnover across all products with FX, FI, and MM transactions increasing MoM by 31.74% (N0.69 trillion), 25.97% (N1.31 trillion) and 22.98% (N0.77 trillion), respectively.
- The increase in MM turnover was driven by an uptick in Repos/Buy-backs and Unsecured Placement/Takings transactions. Likewise, the improvement in FI turnover was driven by an MoM increase across all FI products in the review period,” the report noted.
According to the report, Spot FX market turnover was N2.88 trillion ($6.21 billion) in May 2023, representing an MoM increase of 31.74% (N0.69 trillion) from the turnover recorded in April 2023 (N2.18 trillion).
“In the FX Market, the Naira depreciated against the US Dollar, with the spot exchange rate ($/₦) increasing by 0.07% ($/N0.31) to close at an average of $/N463.39 in May 2023 from $/N463.09 recorded in April 2023.
Exchange rate volatility increased in May 2023 as the Naira traded within an exchange rate range of $/N462.23 – $/N465.13 compared to $/N462.00 – $/N464.00 recorded in April 2023,” it noted.
Fixed Income
The report stated that the Fixed Income (FI) market turnover was N6.36 trillion in May 2023, representing a MoM increase of 25.97% (N1.31 trillion) from the turnover recorded in April 2023 (N5.05 trillion).
- “The MoM increase in the FI market turnover was jointly driven by an uptick in turnover across all FI products with T.Bills, OMO Bills, CBN Special Bills, FGN Bonds and Other Bonds improving by 15.66% (N0.18 trillion), 18.30% (N0.28 trillion), 49.45% (N0.47 trillion), 27.05% (N0.37 trillion) and 86.43% (N0.005 trillion) respectively.
- As a result, the trading intensity (TI) for T.Bills, OMO1 Bills, and FGN Bonds increased MoM by 0.04, 10.99, and 0.02 points to 0.29, 21.68, and 0.10 respectively,” the report said.
