T-Bills Yield Settles at 4.43% as Naira Loses Weight
The average yield on the Nigerian Treasury Bills rests at 4.43 percent on Monday amidst quiet trading activities in the fixed income space after naira sheds buying power, loses weight at the official foreign exchange window.
After the local currency ended the previous week on a strong note against the United States dollar at the Investors and exporters FX window, traders said naira lost weight due to increased demand for the greenback.
Market data shows that Naira depreciated by 0.16 percent as the dollar was quoted at ₦416.67 as against the last close of ₦416.00 while most participants maintained bids between ₦410.00 and ₦444.00, according to FSDH note.
Elsewhere, short term rates track lower in the money market today due to relatively robust liquidity in the financial system; causing a decline in the average interbank rate.
Data from FMDQ Exchange shows that the overnight lending rate sheds 75 basis points to close at 3.25 percent as against the last close of 4.00 percent. Also, the Open Repo (OPR) rate decreased by 33 basis points to close at 3.00 percent compared to 3.33 percent on the previous day.
In the secondary market for Nigerian Treasury Bills, trading activities ended on a flat note with the average yield across the curve remaining unchanged at 4.43 percent.
In its market note, FSDH Capital said the average yields across short-term, medium-term, and long-term maturities remained unchanged at 3.69 percent, 4.24 percent, and 5.35 percent, respectively.
In the OMO bills segment, the average yield across the curve decreased by 37 basis points to close at 5.30 percent as against the last close of 5.67 percent. Read: OMO Bills Steadies as Fixed Income Securities Loses Attraction
Traders said the average yield across the long-term maturities declined by 56 basis points. However, the average yield across the short-term maturities remained unchanged at 5.41 percent.
OMO 16-Aug-22 (-112 bps) maturity bill witnessed buying interest, according to FSDH Capital. Ahead of the Debt Management Office plan to auction N150 billion auction, FGN bonds closed on a mildly positive in the secondary market as holders sold off.
Consequently, the average bond yield across the curve cleared lower by 3 basis points to close at 11.47 percent from 11.50 percent on the previous day. Average yields across short tenor, medium tenor, and long tenor of the curve declined by 2 basis points, 1 basis point, and 4 basis points, respectively.
The 18-MAR-2036 maturity bond was the best performer with a decrease in the yield of 14 basis points, according to FSDH Capital while the 27-MAR-2050 maturity bond was the worst performer with an increase in the yield of 8 basis points. #T-Bills Yield Settles at 4.43% as Naira Loses Weight