The Nigeria Bond Watch - Review and Outlook @020916


Tuesday, February 09 2016 8: 12 AM/ DLM Research

Download Full Report Here

During the review week, the Nigerian fixed income OTC market was influenced by: 1) the release of February 2016 FGN bond offer circular by the DMO; and 2) Treasury and OMO bills auctions by the CBN.

At the treasury bills auction, N45.18billion, N80.00billion and N117.22billion of 91day, 182day and 364day benchmarks were offered and sold at marginal rates of 4.95%, 7.98% and 9.49%, against last auction stop rates at 4.29%, 7.59% and 9.33% respectively. Subscription level stood at N400.84billion (165% of volume offered).

At the OMO auction, the CBN offered N50.00billion of a 192day bill but sold N113.68billion at marginal rate of 7.80%. Subscription level stood at N116.68billion (233% of volume offered). The high subscription level at the auctions was indicative of existing system liquidity and inflows from treasury bills redemption (N192.40billion).

The domestic fixed income market traded on a quiet note last week as selling activities dominated most trading sessions whilst slight demand was seen at the short end of the curve. As a result, yields rose by an average of 20 points week-on-week basis.

The DMO is expected to re-open N40.00billion and N50.00billion worth of 15.54% FEB 2020 (5yr) and 12.50% JAN 2026 (10yr) respectively at this week’s FGN bond auction. Also expected is the redemption of OMO bills worth c.N234.45billion. The bearish bias may continue this week as market players take positions ahead of the auction whilst the CBN is expected to mop up anticipated increase in system liquidity via OMO auctions.

Related News:
1. The Nigeria Bond Watch - Review and Outlook @020116

Disclaimer/Advice to Readers:
While the website is checked for accuracy, we are not liable for any incorrect information included. The details of this publication should not be construed as an investment advice by the author/analyst or the publishers/Proshare. Proshare Limited, its employees and analysts accept no liability for any loss arising from the use of this information. All opinions on this page/site constitute the authors best estimate judgement as of this date and are subject to change without notice. Investors should see the content of this page as one of the factors to consider in making their investment decision. We recommend that you make enquiries based on your own circumstances and, if necessary, take professional advice before entering into transactions. This article is published with the consent of Dunn Loren Merrifield, the author(s) for circulation to the online investment community in accordance with the terms of usage. Further enquiries should be directed to the author whose e-mail is [] Dunn Loren Merrifield Limited.  

Related News