T-bills Yield Slides 76bps Amidst Liquidity Pressure
The treasury bills market switched gears from selling rallies experienced in the past days following the apex bank primary market auction on Wednesday.
In the secondary market, trading activities in the treasury bills segment were bullish across short, mid and long tenors, causing the average yield to contract by 76 basis points to 11.2%, according to a note by Codros Capital Limited.
In its market update, Cordros Capital told investors that across the curve, the average yield declined across the short (-8bps), mid (-44bps) and long (-133bps) segments.
This was as a result of market participants demand for 92-day to maturity (-19bps), 169-day to maturity (-66bps) and 323-day to maturity (-267bps) bills, respectively.
The market witnessed buying interest on short-dated instruments, causing the yield to decline by 19 basis points. Due to demand for mid-tenor bills, its associate yield slowed down by 66 basis points and demand for 323-day bills caused the yield to drop by 267 basis points.
Elsewhere, the average yield was flat at 9.6% in the OMO bill segment as a result of low transaction volume following the apex bank auction.
In the money market, short-term interest rates rose as pressure on financial system liquidity worsened in the absence of significant inflows into the space.
Key money market rates, such as the open repo rate and overnight lending rate advanced by 3.08% and 2.83% to 19.08% and 19.83%, respectively. In the bond market, trading activities were bullish, as the average yield dipped by 2bps to 15.3%.
Traders said across the benchmark curve, the average yield was unchanged at the short and mid segments but contracted at the long (-4bps) end following bargain hunting in the JAN-2042 (-21bps) bond. #T-bills Yield Slides 76bps Amidst Liquidity Pressure#
