Treasury Yield Prints at 4.50% as Demand for Short-Term Bills Spikes
Activities at the Nigerian Treasury Bills secondary market traded on a quiet to bullish note, following flatness at both the short and mid ends of the curve while the long end dropped by 3 basis points.
Consequently, the average yield was down slightly by one basis point to close at 4.50% amidst a slowdown in the financial system liquidity pressures.
Today, the average interbank rate sustained its prior stance following the flatness of both the Open Buy Back rate and Overnight rate, Alpha Morgan Capital hinted in its market note.
Data from the FMDQ Exchange shows that the Overnight rate remained unchanged at 15.75 per cent, and the Open Buy Back (OBB) rate remained unchanged at 15.50 per cent.
According to various analysts note, the T-Bills secondary market closed with average yield across the curve decreasing by 1 basis point to close at 4.50 per cent from 4.51 per cent on the previous day.
However, average yield across the long-term maturities declined by 2 basis points. FSDH Capital spotted that the average yields across short-term and medium-term maturities remained unchanged at 3.52 per cent and 3.74 per cent, respectively.
NTB 13-Oct-22 (-19 bps) maturity bill witnessed mild buying interest, while yields on 21 days to maturity bills remained unchanged.
In the OMO bills market, the average yield across the curve closed flat at 5.48 per cent, according to FSDH Capital note. Average yields across short-term, medium-term, and long-term maturities remained unchanged at 5.35 per cent, 5.55 per cent, and 6.14 per cent, respectively.
FGN bonds secondary market closed on a mildly negative note today, as the average bond yield across the curve cleared higher by 5 bps to close at 8.05 per cent from 8.00 per cent on the previous day.
Market data shows that average yields across short tenor, medium tenor, and long tenor of the curve increased by 2 basis points, 25 basis points, and 2 basis points, respectively.
The FGNSB 14-MAY-2023 bond was the best performer with a decrease in the yield of 4 bps, while the 23-FEB-2028 maturity bond was the worst performer with an increase in yield of 41 basis points.
Today, the DMO has started offering a 2-Year FGN Savings Bond due December 15, 2023, and a 3-Year FGN Savings Bond due December 15, 2024, at the interest rate of 7.322 per cent per annum and 8.322 per cent per annum, respectively.
The bond auction is scheduled to close on December 10, with a settlement on December 15. The interest will be paid quarterly, with a redemption bullet repayment on the date of maturity.
