After the main market auction held by the top bank on Wednesday, the market for Treasury bills shifted from the selling rallies of the previous several days.
According to a report by Codros Capital Limited, trading activity in the treasury bills segment in the secondary market was positive across short, mid, and long tenors, which resulted in a 76 basis point contraction in the average yield to 11.2%.
Investors were informed by Cordros Capital in its market report that the average yield decreased in the short (-8bps), mid (-44bps), and long (-133bps) segments throughout the curve.
The demand for bills with maturities of 92 days (-19bps), 169 days (-66bps), and 323 days (-267bps) from market players was the cause of this.
The market witnessed buying interest on short-dated instruments, causing the yield to decline by 19 basis points. Due to demand for mid-tenor bills, its associate yield slowed down by 66 basis points and demand for 323-day bills caused the yield to drop by 267 basis points.
Elsewhere, the average yield was flat at 9.6% in the OMO bill segment as a result of low transaction volume following the apex bank auction.
In the money market, short-term interest rates rose as pressure on financial system liquidity worsened in the absence of significant inflows into the space.
Key money market rates, such as the open repo rate and overnight lending rate advanced by 3.08% and 2.83% to 19.08% and 19.83%, respectively. In the bond market, trading activities were bullish, as the average yield dipped by 2bps to 15.3%.
Traders said across the benchmark curve, the average yield was unchanged at the short and mid segments but contracted at the long (-4bps) end following bargain hunting in the JAN-2042 (-21bps) bond.
