Money Market Rate Decreased As Overnight Rate Fell To 17.50%


Monday, February 18 2019  11:15 AM / Anchoria AM Research


Money Market

The money market rate decreased last week as the Overnight rate (OVN) and Open Buy Back (OBB) fell to 17.50% and 15.83% respectively. Consequently, the average money market rate fell by 2.38% to settle at 16.67% due to the increase in the System liquidity to cN330bn from a negative figure of cN128bn in the previous week. Major inflow for the week included: OMO repayment of cN800bn and Coupon Payment of cN47bn while Outflow for the week included: OMO sales of cN545bn; Weekly Wholesale, Invisible and SME FX auction of $210mn and Bi-weekly retail auction. 

It must be asserted that the lending rate rose to as high as 43% on Monday due to the inability of banks to access CBN Standing Lending Facility (SLF) to fund their deficit.














Source: Anchoria AM Research, FMDQ OTC


Forex: USD/NGN

The CBN Official rate reversed its downward trend to close at N306.75/$, an 0.02% increase while the rate in the Investors and Exporters’ FX Window fell by 0.02% to close at N361.65/$. We observed an increase in the market turnover in the I&E Window to $1.67 billion during the week from $0.81 billion in the previous week. However, Naira at the parallel market depreciated marginally by 0.28% to close at N361.00/$ (using the Everdon BDC Rate). 

We expect rates in the parallel market to remain constant as the apex bank continues to supply FX into the market, coupled with its frequent Wholesale and Retail SMIS programme.




CBN Official Rate




I&E FX Window




Everdon BDC Rate




Source: Anchoria AM Research, FMDQ OTC



The Brent Crude Oil and WTI Crude Oil rose by 6.68% and 5.44% to close at $66.25 and $55.59 per barrel respectively due to OPEC Output Cut and Saudi Arabia Shutdown.


Fixed Income

Bond: FGN

Ahead of the election date previously scheduled for Saturday, 16 February 2019, the Bond Market remained bullish as sustained demand were seen on most maturities during the week. Notable amongst them include 2022s (49bps) and 2036s (34bps).  Average yields fell by 3bp to close the week at 14.65%. Other factors that shaped the market include: improved results of Q4 GDP Growth Rate which came in at 2.38%; Moderation of the headline inflation rate in January to 11.37% (11.44% previously) 

With the postponement of the General Elections on the election day, we expect the market to open on a quieter note this week, although we do not expect a drastic change in market trend during the week.


Secondary Market

Proshare Nigeria Pvt. Ltd.

Source: Anchoria AM Research, FMDQ OTC


Treasury Bills

Despite an increase in system liquidity during the week, the treasury bills market traded on a bearish note. Consequently, the average yield rose by 14bps to close the week at 14.75%.


The T-bill auction conducted during the week witnessed an oversubscription with spot rate trending lower than the previous stop rate

Secondary Market

Proshare Nigeria Pvt. Ltd.

Anchoria Research: +234 908 720 6076;


Proshare Nigeria Pvt. Ltd.

Related News

1.       Market Players Rally FGN Bonds in Final Pre-election Bets

2.      CBN OMO Repayment Moderates Funding Rates

3.      Invest in FGN Monthly Bond Auction – February 2019

4.      Market Players Oversubscribe NTB Auction by 286%

5.      CBN Holds Off on OMO Sale as Funding Rates Moderate

6.      Funding Rates Spike to YTD High as CBN Drains System Liquidity into Negative

7.      January 2019 FGN Bond Auction Oversubscribed

8.     Money Market Rate Increased As Overnight Rate Rose To 11.86%

9.      Flour Mills Commercial Paper Offers 14.75% Yield; Offer Closes On Wednesday

10.  Monthly Fixed Income Review For January 2019

11. Bond Market Maintains Bullish Trend as Panic Buying Sets In

Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.
Related News