Bonds & Fixed Income | |
Bonds & Fixed Income | |
3986 VIEWS | |
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Monday, January 14, 2018/ 05:30PM / Zedcrest Capital
***Nigeria and South Africa to recover slowly in 2019 ***
- Moody’s
KEY
INDICATORS
Indicator |
Value |
Commentary |
Inflation |
11.28% |
As at December 14, 2018. A c.2bps increase from 11.26% recorded
in October 2018 |
MPR |
14.00% |
Left Unchanged for the 12th Consecutive Time at the
Nov. 22, 2018 MPC Meeting |
External Reserves |
$43.05bn |
As at January 10, 2018. A c.0.00% increase from $43.05bn on January
9, 2018 |
Brent Crude |
$59.76pb |
As at January 14, 2019. A c.0.95% increase from $60.54pb on January 13, 2018 |
Bonds
In line with our expectations, yields in the bond market moderated
further by c.2bps, even as offers pulled further away following demand on the
mid to long end of the curve, especially the 27s and 37s.
We expect yields to remain moderated for most of the week as
inflows from coupon payments are expected to support bullish sentiments in the
near term.
Benchmark
FGN Bonds |
|||
Description |
Bid (%) |
Offer (%) |
Day Change
(%) |
15.54 13-Feb-20 |
15.14 |
14.47 |
0.11 |
14.50 15-Jul-21 |
15.42 |
15.12 |
(0.08) |
16.39 27-Jan-22 |
14.99 |
14.70 |
0.00 |
14.20 14-Mar-24 |
15.10 |
14.75 |
0.00 |
12.50 22-Jan-26 |
15.55 |
15.35 |
(0.01) |
16.29 17-Mar-27 |
15.38 |
15.27 |
(0.07) |
13.98 23-Feb-28 |
15.50 |
15.33 |
(0.04) |
12.15 18-Jul-34 |
15.48 |
15.24 |
(0.02) |
12.40 18-Mar-36 |
15.48 |
15.24 |
(0.03) |
16.2499 18-Apr-37 |
15.29 |
15.19 |
(0.10) |
Source: Zedcrest Dealing
Desk
Treasury
Bills
Yields in
the T-bills market moderated slightly in today’s session as market players
cherry-picked on some maturities in anticipation of client demand ahead of the
forthcoming NTB auction. This was despite the c.25bn OMO sale by the CBN.
We expect
yields to remain relatively stable on the back of expected client flows into
the market.
|
|||
Description |
Bid (%) |
Offer (%) |
Day Change
(%) |
14-Feb-19 |
15.00 |
14.00 |
0.00 |
14-Mar-19 |
15.40 |
13.80 |
0.30 |
4-Apr-19 |
14.05 |
13.80 |
0.05 |
2-May-19 |
14.50 |
13.00 |
0.20 |
13-Jun-19 |
13.60 |
13.25 |
0.00 |
18-Jul-19 |
13.75 |
13.20 |
(0.25) |
1-Aug-19 |
14.55 |
13.65 |
(0.05) |
12-Sep-19 |
14.90 |
14.60 |
(0.10) |
3-Oct-19 |
14.95 |
14.60 |
(0.10) |
14-Nov-19 |
14.90 |
14.60 |
(0.10) |
5-Dec-19 |
15.10 |
14.90 |
0.00 |
Source:
Zedcrest Dealing Desk
Money
Market
Rates in the
money market spiked by c.12pct, with the OBB and OVN rates closing the day at
31.67% and 35.25% respectively. This came on the back of a wholesale FX
intervention by the CBN which is estimated to have worsened system liquidity to
c.N225bn negative as at COB today.
We expect rates
to remain elevated, as there are no significant inflows expected tomorrow.
Money Market Rates |
||
|
Current (%) |
Previous (%) |
Open Buy Back (OBB) |
31.67 |
20.00 |
Overnight (O/N) |
35.25 |
22.50 |
Source: FMDQ, Zedcrest
Research
FX Market
At the Interbank, the Naira/USD rate
appreciated by c.0.02% to N306.85/$ at the spot market, while the SMIS rate
remained unchanged at N358.13/$. The NAFEX rate in the I&E window appreciated
by c.0.18% to N364.30/$ from N364.94/$ previously, while the cash and transfer
rates remained unchanged at N360.80/$ and N365.00/$ respectively at the
parallel market.
FX Market |
||
|
Current (N/$) |
Previous ( N/$) |
CBN Spot |
306.85 |
306.90 |
CBN SMIS |
358.31 |
358.31 |
I&E FX Window |
364.30 |
364.94 |
Cash Market |
360.80 |
360.80 |
Transfer Market |
365.00 |
365.00 |
Source: CBN, FMDQ, REXEL
BDC
Eurobonds
Investors’ interests
on the NGERIA Sovereigns cooled off
in today’s session, as yields expanded by c.7bps on average, following slight
selloff on the longer end of the curve.
In the NGERIA Corps investors renewed
interests for the DIAMBK 19s and Zenith 22s.
Related News
1. T-Bills Market
Records Bullish Performance As Average Yields Decline to 15.3%
2. Money Market Rate Decreased As Overnight Rate Fell to
22.50%
3. Funding Rates Moderate Slightly as CBN Holds off on OMO
4. Funding Rates Remain Elevated as CBN Mops Up OMO Maturities
5. Rising Oil Prices Sustain Demand for Nigerian Eurobonds
6. T-Bills Yields Tick Higher as CBN Resumes OMO Sale
7. T-Bills Market Reverses Bullish Run as Average Rate
Advances to 14.3%
8. January 2019 FGN Savings Bonds Offer For Subscription
9. EBRD Issues Debut €600 Million 5-Year Global Green Bond
10. Investors Rally Nigerian Eurobonds as Oil Prices Push
Higher