Bonds & Fixed Income | |
Bonds & Fixed Income | |
582 VIEWS | |
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Below
were highlights of trading activities in the fixed income and forex market
today
Bonds
Activity in the Bond
market picked up in today's trading session, demand improved at the mid-end of
the bond curve. We noticed a preference for yields, as investors dumped the
2028s in favour of the higher-yielding
2029s. Yields consequently compressed by c.1bp on the average across the
benchmark yield curve.
We expect a slight increase in demand for bonds, as investors weigh reinvestment options for bond maturities of c.N234bn expected later in the month.
Source:
Zedcrest Dealing Desk
Treasury Bills
The T-bills
market opened on a bullish trend, most especially at the long-end of the NTB
curve, as investor demand flowed into the secondary market in the absence of an
OMO auction. We noted large trading activity on the 28-sept-20 and 1-oct-20
maturities in particular, which saw c.25bps downward movement in yields. Yields
consequently closed the week lower by c.6bps on the average across the
benchmark NTB curve.
We expect the
current bullish trend to be sustained opening the week, supported by buoyant
system liquidity.
Benchmark Treasury Bills |
|||
Description |
Bid (%) |
Offer (%) |
Day Change (%) |
14-Nov-19 |
12.60 |
11.70 |
0.10 |
5-Dec-19 |
12.80 |
12.40 |
0.10 |
2-Jan-20 |
12.10 |
11.60 |
(0.40) |
6-Feb-20 |
12.80 |
12.00 |
(0.20) |
19-Mar-20 |
12.80 |
11.60 |
(0.10) |
2-Apr-20 |
12.80 |
11.80 |
0.00
|
14-May-20 |
13.10 |
12.60 |
0.20 |
04-Jun-20 |
13.00 |
12.20 |
0.00
|
02-Jul-20 |
12.95 |
12.75 |
(0.30) |
13-Aug-20 |
13.10 |
12.85 |
(0.05) |
3-Sep-20 |
13.20 |
12.75 |
(0.05) |
Source: Zedcrest Dealing Desk
Money
Market
Money market rates dropped by an average of c.500bps from
yesterday as expected with the excess liquidity in the market. OBB and OVN
rates closed the week at 2.71% and 3.43% respectively.
We expect money market rates to remain low barring any aggressive
mop-up by the CBN.
Money Market
Rates |
||
|
Current (%) |
Previous (%) |
Open Buy Back
(OBB) |
2.71 |
8.05 |
Overnight (O/N) |
3.43 |
9.50 |
Source: FMDQ, Zedcrest
FX Market
At the interbank, the Naira/USD spot rate remained stable
at N307.00/$ while the SMIS rates remained stable at N358.13/$. At the I&E
window, the closing rate for the Naira was depreciated by 22k to close the week
at N362.77/$.
The cash and transfer rates at the parallel markets also saw
no change, closing at N357.80/$ and N362.50/$ respectively.
FX Market |
||
|
Current (N/$) |
Previous ( N/$) |
CBN Spot |
307.00 |
307.00 |
CBN SMIS |
358.13 |
358.13 |
I&E FX
Window |
362.77 |
362.55 |
Cash Market |
357.80 |
357.80 |
Transfer Market |
362.50 |
362.50 |
Source: CBN, FMDQ, REXEL BDC
Eurobonds
Trading activity in the NGERIA Sovereigns and Corps
papers closed the week on a muted note. Nigerian financial bank papers
remained pressured in the aftermath of debits worth $1.4 billion in penalties
over failure to meet the set loan to deposit ratios by the Central Bank of
Nigeria as it tries to spur growth in the economy.
Related News
1.
Interswitch
Limited Bond Issue Coming Soon
2.
P and ID Versus
Nigeria... How The Markets Have Responded
3.
Treasury Bills Auction
Scheduled For October 2nd, 2019
4.
The Bulls Re-Emerge As
Average Yield On T-Bills Dips To 13.3% WoW On System Liquidity Boost
5.
Investors Look to
Secondary Market to Fill Demand, Treasury Bills Close Week Bullish
6.
CBN Sells 364-Day OMO
T-Bills On A 46.00% Pro-rata Basis, Cuts Rates By 2bps
7.
Summary of FGN Bond
Auction Results For September 2019
8.
September 2019 FGN Bond
Auction Oversubscribed
9.
DMO Struggles to Raise
Long Term Debt for a Second Consecutive Auction
10. FMDQ Securities
Depository Goes Live, To Enhance Market Efficiency
11.
Bearish Momentum
Sustained As Average T-Bills Yield Advances 23bps WoW To 13.6%
12. NSE Lists FGN Savings Bonds