Bonds Sold Off as Profit-taking Offset Bargain Hunting
For the first time this week, Bonds sold off as profit-taking mostly at the belly of the curve (+12bps) offset bargain hunting at the short and long end of the market.
Across instruments, sell pressure was heaviest on 22-JAN-2026 (+48bps) while 26-APR-2049 (-27bps) was the most demanded, Greenwich Merchant Bank says in a note.
Meanwhile, trading closed on a quiet note despite heavy bids at the T-Bills primary market auction (PMA) yesterday.
Thus, yields stayed flat at an average of 0.1% while system liquidity eased. Analysts said they expect liquidity to close the week healthy, barring any significant outflow.
In the OMO market, activities were muted as selloffs matched buying interests at the tail of the curve to keep yields unchanged at 0.2%.
Read Also: Money Market Rates Fall as Inflow from Matured OMO Bills Lifts Liquidity
For the first time this week, funding rates halted its decline, with the OBB & OVN increasing by 25bps apiece to 0.75% and 1.00% respectively.
Financial system liquidity remained buoyant, however, opening today’s session marginally lower at N340.73bn as against yesterday’s open of N387.69bn.
After close of trading, discount rates on benchmark NTBs and OMO bills were unchanged at an average of 0.10% and 0.15% respectively.
There was volatility in the bond market amid renewed appetite for duration.
However, average yield on the benchmark bond yield curve was unchanged at 4.10%.
This was due to sell pressure on intermediate bonds (+14bps to 4.34%), was offset by buy sentiments on short (-9bps to 1.49%) and long (-10bps to 5.87%) term bonds.
In the foreign exchange market, Naira weakens further to NGN494.00 to a dollar.
Bond Sold off as Profit-taking offset Bargain Hunting
