DMO Maintains 60% Rollover of Maturing PMA Bills

Proshare

Wednesday, July 04, 2018 /08:20 PM / Zedcrest Capital

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KEY INDICATORS

Inflation

11.61%

Declined by 0.87% in May from 12.48% in April 2018

MPR

14.00%

Left unchanged at 14.00% at the MPC meeting 0n 4 April 2018

External Reserves

$47.63billion

Rose by 0.36% as at 3 July from $47.63bn as at 13 June 2018

Brent Crude

$78.08pb

Rose by 1.39% from $77.01pb on 3 July 2018

 

 

Bonds

Activities in the Bond market today was dominated by the local players, with more buyers seen on the shorter end of the curve (21s and 22s) and mixed sentiments on the longer end (slight demand on the 2036s and more selling on the 34s and 37s). Yields consequently compressed by c.5bps on average.  We expect the market to remain client driven in the near term, with yields expected to remain relatively stable, barring a renewed selloff from offshore clients.

 

FGN Bonds

Description

Bid (%)

Offer (%)

Day Change (%)

15.54 13-Feb-20

13.37

13.09

0.00

14.50 15-Jul-21

13.67

13.44

(0.37)

16.39 27-Jan-22

13.79

13.25

(0.42)

14.20 14-Mar-24

13.98

13.69

0.19

12.50 22-Jan-26

14.22

14.03

(0.04)

16.29 17-Mar-27

14.19

13.89

0.14

13.98 23-Feb-28

14.11

14.00

(0.16)

12.15 18-Jul-34

14.32

14.12

0.09

12.40 18-Mar-36

14.30

14.16

0.00

16.2499 18-Apr-37

14.36

14.17

0.12

Source: Zedcrest Dealing Desk

 

 

Treasury Bills

The T-bills market traded on a slightly bullish note, with yields compressing further by c.7bps on average. This came on the back of continued demand in anticipation of OMO and PMA maturities tomorrow. There was a PMA today, with rates left relatively unchanged on the 91 and 364-day, while the 182-day cleared 20bps higher. We however note that the DMO sold only 60% of the total amount offered, a trend also observed in the previous auction. It consequently decided to repay a total sum of N68.20bn of the 364-day maturity, most likely from the residual balance of its Eurobond proceeds raised earlier this year. We expect yields to remain relatively stable tomorrow, with the CBN expected to conduct an OMO auction to moderate excess inflows from maturing OMO T-bills and Net PMA repayments.  


Treasury Bills

Description

Bid (%)

Offer (%)

Day Change (%)

2-Aug-18

12.35

12.00

0.10

13-Sep-18

12.15

11.85

(0.20)

4-Oct-18

11.45

11.20

(0.30)

1-Nov-18

12.30

12.10

0.00

6-Dec-18

12.35

12.10

0.00

3-Jan-19

12.10

11.95

(0.10)

14-Feb-19

12.10

11.95

0.05

14-Mar-19

12.40

11.75

0.00

4-Apr-19

12.10

11.00

(0.35)

Source: Zedcrest Dealing Desk 


NTB PMA Result - 4 July 2018

Tenor

Rate (%)

Offer (N'bn)

Sub (N'bn)

Sale (N'bn)

91 days

10.00

9.52

18.76

9.52

182 days

10.30

33.93

33.99

33.93

364 days

11.50

127.06

99.36

58.86

Source: CBN 

 

Money Market

The OBB and OVN rates declined further to 17% and 18.33% respectively, as there were no significant funding pressures in the system. System liquidity is consequently estimated to remain relatively stable at c.N100bn positive. We expect rates to trend lower tomorrow, due to expected inflows from OMO and Net PMA repayments (c.N240bn).

 

Money Market Rates

 

Current (%)

Previous (%)

Open Buy Back (OBB)

19.33

30.00

Overnight (O/N)

20.08

32.50

Source: FMDQ, Zedcrest Research

 

FX Market

The Interbank rate remained stable at its previous rate of N305.70/$, with the CBN’s external reserves recorded to have improved by 0.36% to $47.80bn from $47.63bn on the 13th of June. The I&E FX rate fell back by 0.03% to N361.40/$, while the total volume traded improved slightly by 11.83% to $179m. In the parallel market, cash rates appreciated further by 20k to N358.80/$, while the transfer market rate remained stable at N364.00/$.

 

FX Market

 

Current (N/$)

Previous ( N/$)

CBN Spot

305.70

305.70

CBN SMIS

330.00

330.00

I&E FX Window

361.40

361.28

Cash Market

358.80

359.00

Transfer Market

363.50

364.00

Source: CBN, FMDQ, REXEL BDC 

 

Eurobonds:

The NGERIA Sovereigns traded on a relatively flat note, with yields compressing marginally by c.2bps. We however witnessed slight buying interests mostly on the 27s and 37s which rose by +0.25pt and +0.40pt respectively.

 

The NGERIA Corps were also relatively quiet, except for slight buying interests seen on the ACCESS 21s Snr and UBANL 22s.


Proshare Nigeria Pvt. Ltd.



Proshare Nigeria Pvt. Ltd.

 

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