FGN Bond Yield Climbs, Treasury Bills Prints Lower

FGN Bond Yield Climbs, Treasury Bills Prints Lower

Bonds, and Treasury bills yields moved in different directions on Thursday as the market weighs various developments in the financial markets. In the secondary market, traders noted that FGN bonds were relatively flat for most tenor buckets.

Investors traded in the front end of the naira yield curve with the 23 Apr FGN 2023 bond and 14 Mar FGN 2024 bond instrument yields expanding by 0.06 and 0.69 percentage points, respectively, according to Cowry Asset.

As a result, the average secondary market yield climbed by 0.03 percentage points to 14.48%, traders’ market report shows. Across the benchmark curve, Cordros Capital analysts wrote that the average yield expanded at the short (+12bps) end due to the sell-off of the MAR-2024 (+69bps) bond.

Meanwhile, the FGN Bond yield line contracted at the long (-2bps) end as investors demanded the APR-2037 (-14bps) bond. However, traders said in their market report that the average yield was flat at the mid-segment.

Similarly, the value of the FGN Eurobond decreased across all maturities tracked, even as the average yield expanded by 0.27 percentage points to 14.44%, indicating sustained negative sentiment.

In the money market, short-term rates moderated further, staying at single digits after pressures on the financial system liquidity eased as a result of inflows from maturing instruments.

Data from the FMDQ Exchange platform showed that the open buyback rate and overnight lending rate inched lower to 8.50% and 8.83%, respectively. Read: US Treasury 10-Year Auction Hits 2.943% as Inflation Climbs

Buying interest was spotted in the secondary market for Nigerian Treasury bills on Thursday. Thus, the average yield fell by 0.20 percentage points to 10.92%.

Across the curve, market analysts stated that the average yield contracted at the short (-171bps) end, following interests on the 7-day to maturity (-513bps) bill, but expanded at the long (+33bps) end due to profit-taking on the 203-day to maturity (+198bps) bill.

Conversely, the average yield closed flat at the mid-segment. Elsewhere, the average yield was unchanged at 10.2% in the OMO bills segment. #FGN Bond Yield Climbs, Treasury Bills Prints Lower

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