Bond Market Turns Bullish as Investors Book Gains in Treasury Bills
Bond market turns bullish as investors book gains in Nigerian Treasury Bills space amidst rising inflation rate in the country.
The T-bills market closed on a bearish tone, aided by sell-offs on the short segment of the market, even as the rest of the market remained muted.
Analysts at Greenwich Trust Limited hinted that after trades, yields notched higher by 1 basis point to 0.5% compared to the flattish close yesterday.
Meanwhile, interbank liquidity remained robust today, boosted by open market operations (OMO) maturities estimated at N410.04 billion.
As a result, funding rates moderated slightly.
Notably, the Open Buy Back (OBB) and the Overnight (OVN) rates declined by 37bps and 50bps to 0.63% and 1.00% respectively.
Both Greenwich Trust and Chapel Hill Denham expectation remain that funding rates will remain benign.
Largely, the fixed income market traded flattish as investors remain apprehensive on the direction of monetary policy and the interest rate environment.
At the short end of the curve, the Treasury bill benchmark curve expanded marginally due to selling at the short end of the curve.
Meanwhile, Open Market Operations curve expanded by an average of two basis points to close at 0.69%.
Based on trade pattern, analysts at Chapel Hill Denham observed investor preference for shorter dated bonds, while duration apathy persisted.
As a result, the benchmark bond yield curve eased marginally by 1bp to 6.53%.
In the currency market, the Naira strengthened further in the Investors & Exporters Window by 0.12% or 47 kobo to 393.83, but closed flat in the official window at 379.00.
The foreign exchange rate in the parallel market rate was unchanged at 470.00.
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Bond Market Turns Bullish as Investors Book Gains in Treasury Bills
