Author: Julius Alagbe

Naira Appreciates Across Forward FX Contracts The naira has seen significant appreciation across forward foreign exchange (FX) contracts, driven by investor optimism and improved market liquidity. Last week, the naira appreciated across contracts in the forward FX market, reflecting investors; expectation about the local currency outlook. This upward trend reflects solid market governance and growing investor confidence, with one year forward FX contract appreciating to N1879.61 per dollar, up by 4% week on week. The local currency opened the month of July on a strong note at the Nigerian foreign exchange market (NFEM) after about 4% gain against the dollar…

Nigerian Bonds Rally, Benchmark Yield Falls by 31bps The average yield on Nigerian government bonds fell by thirty one (31) basis points (bps) in the secondary market as investors increased bets on naira assets. Trading activities were heated up over signs of lower bonds supply via primary market auction. Demand was concentrated at the mid to long end of the curve. Bonds buying was supported by ample system liquidity The thin supply from the Debt Management Office (DMO) in the second quarter triggered successive rallies in the secondary market, and then drag yield downward across the curve. This market narrative…

Naira Keeps Gaining Streaks Amidst Rising Hot Money Inflows The Nigerian naira has been on an upward trend for five days in a row in the official market due to the interplay of demand and supply favouring the local currency exchange rate. The Nigerian economy recorded a sharp increase in hot money in the second quarter as foreign portfolio investors drove US dollar volume in the official window—following successive OMO bill auctions. Data obtained from the Central Bank of Nigeria (CBN) showed that the Nigeria foreign exchange market rate (NFEM) for Thursday settled at N1525.82 per dollar, from N1526.15 the…

Nigerian Banks Drive Intraday Momentum in Equities Market The Nigerian Exchange (NGX) is tracking higher sharply during the intraday trading session as investors increase their bets on Nigerian banks. Buying interest in local banks stocks continues to gain momentum ahead of the second quarter earnings release. The local bourse is experiencing a significant rise in value in intraday trading as investors show more confidence in Nigerian banks. Interest in purchasing shares in local banks is growing steadily in anticipation of the upcoming second-quarter earnings announcement. The increased bargain hunting followed a recent assurance given by the Central Bank of Nigeria…

Nigerian Treasury Bills Yield Falls Below 20%, OMO Rate Dips The average yield on Nigerian Treasury bills (NTB) has fallen below 20%—the first time in a long time—as investors continue to ramp up the naira assets in the absence of a midweek primary auction (PMA). For two consecutive weeks, the Central Bank of Nigeria (CBN), through the Debt Management Office (DMO), has not conducted a primary market auction for Treasury bills. This has fueled trading activities in the secondary market, with investors maintaining focus on assets with long durations. Yesterday, the Nigerian Treasury bill market ended the proceeding on a…

CBN Allots OMO Bills Worth N745bn to Investors at 23.99% The Central Bank of Nigeria (CBN) allotted OMO bills worth N745 billion to investors at the end of its latest open market operation. The Apex Bank floated N600 billion at the primary market via competitive auction to mop up excess liquidity in the financial system. The money market has been flooded with significant funds in the absence of Treasury bill actions last week. Though the market experienced inflows from matured bills, leaving the liquidity balance in a positive net position. In response to elevated system liquidity, the CBN floated an…

Naira Strengthens after CBN Injects $96m into FX Market The naira strengthened against the US dollar as data showed the Central Bank of Nigeria (CBN) injected more than $96 million into the official foreign exchange (FX) market last week. The CBN FX interventions lifted the US dollar volume, supported by sustained foreign investors’ confidence in the official window. The US dollar volume rose due to CBN FX interventions, backed by ongoing foreign investors’ trust in the official channel. The CBN figures show that the official window’s spot rate ended at N1529.71 per dollar on Monday, down from N1539.23 on Friday…

Algerian Economy Broadly Positive Despite High Fiscal Vulnerabilities The near-term prospects for the Algerian economy remain broadly positive despite global uncertainty, but fiscal vulnerabilities are high, the International Monetary Fund (IMF) said in an official statement following the conclusion of Article IV consultation. Moreover, the Algerian economy must focus on sustainable practices to secure its future. The IMF emphasises that for the Algerian economy to thrive, a robust fiscal strategy is crucial. Addressing the unique challenges of the Algerian economy will require careful planning and execution. Investment in various sectors of the Algerian economy is vital for achieving sustainable growth.…

Weak US Dollar Boosts Oil Demand, Brent Price Climbs Near $67 A weak US dollar boosted demand for oil in the global commodity market on Monday, with Brent hovering at about $67 while West Texas Intermediate inched near $65 per barrel. Oil prices increased during the early hours as investors sought to take advantage of last week’s declines, while a weaker US dollar supported demand. International benchmark Brent crude rose by 0.37%, trading at $66.58 per barrel, up from $66.33 at the previous session’s close. Similarly, US benchmark West Texas Intermediate (WTI) increased by about 0.26%, reaching at $64.71 per…

FGN Bond Yield Falls to 18.4% as Thin Supply Stokes Rally The average yield on Federal Government of Nigeria (FGN) bond eased by 19 basis points to close the week at 18.4% due to bullish activities in the secondary market, a slew of fixed income market analysts said in separate notes. The local bond market opened the trading session last week on a quiet note, with minimal activity following the bond auction. The market noticed sporadic trades on the Nigerian bonds maturing in 2029, 2031, 2033, and 2053. Momentum picked up midweek after the auction results revealed strong demand and…