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Bond yields record 67bps YTD decline on sustained offshore interests


Wednesday, January 10, 2018 9:00PM / @ZedcrestCapital

*** World Bank Forecasts 2.5% Growth for Nigeria in 2018***

Proshare Nigeria Pvt. Ltd.


The Bond market remained significantly bullish in today’s session, dropping by another 14bps, to mark a remarkable 67bps YTD decline in yields from 14.00% to 13.33%. This has been largely driven by offshore interests, even as domestic participants stay skittish on offers, especially on the long end of the curve. We expect cautious trading at these levels, with the sentiment still slightly bullish, due to the continued presence of offshore flows in the market.

Proshare Nigeria Pvt. Ltd.


Treasury Bills

The T-bills market was slightly bullish in today’s session, with some demand witnessed on the long end of the curve (Jul 18 - Jan 19), in the absence of an OMO auction by the CBN for the second consecutive day. We consequently witnessed a slight decline in yields to sub 14% levels, with most trades done within 13.50% - 14.00% range. We however expect a resumption in OMO issuance by the CBN due to the c.N309bn maturing OMO bills tomorrow. An absence of OMO will most likely fuel a significant decline in yields.


 Proshare Nigeria Pvt. Ltd. 


Money Market

The OBB and OVN rates declined to 13.86% and 14.57% as market liquidity improved to c.N131bn positive in absence of an OMO auction by the CBN. We expect rates to decline further tomorrow due to expected inflows from maturing OMO bills. This is however barring a significant OMO T-bill sale by the CBN.

Proshare Nigeria Pvt. Ltd.


FX Market

The CBN Official spot rate appreciated by 0.02% to N305.85/$ from its previous day rate of N305.90/$. Rates at the Investors and exporters FX window depreciated by 0.29% to N360.73/$. Rates at the parallel market also depreciated by 0.06% to N361.40/$.

Proshare Nigeria Pvt. Ltd.

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