The Nigeria Bond Watch - Review and Outlook @040715


Tuesday, April 7, 2015 6:50 PM/ DLM Research

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NALYSIS During the week under review, market activities were influenced by maturity of OMO bills as well as the smooth conclusion of the highly anticipated presidential elections.

The domestic fixed income market experienced aggressive demand due to elevated system liquidity from OMO bills redemption worth c.N148.78billion coupled with non-issuance of OMO bills by the CBN contrary to market expectation. More so, the renewed confidence in the Nigerian investment space due to the successful conclusion of elections also encouraged buying pressure from domestic investors. Marginal demand from foreign investors equally contributed to the bullish run in the market. Consequently, yields decreased by an average of 109basis points across board on a week-on-week basis.

In the week ahead, T.bills worth N183.65billion will be offered across maturities (91day-N20.16billion, 182day-N43.49billion and 364day- N120.00billion). We expect redemption of treasury bills worth N157.52billion. As system liquidity diminishes and as the next round of elections draws nearer, the bullish trend may reverse and hence a rise in yields is anticipated.

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