Prior to the Central Bank of Nigeria’s (CBN) planned primary market (PMA) auction on Monday, the average yield on Nigerian Treasury Bills (NTB) remained constant at 6.9%.
The CBN would roll over Nigerian Treasury Bills with maturities of 91 days, 182 days, and 364 days totaling N108.13 billion during the auction. Some traders have stated that they anticipate good subscription levels due to the financial system’s solid liquidity.
Analysts indicated that short-term benchmark rates decreased, remaining in the single-digit range, in response to fluctuations in money market rates. The overnight lending rate decreased by 30 basis points to 2.5% at the start of the week, according to data from the FMDQ.
The lack of any major pressure on financing rates, which affected transaction direction in the secondary market for Nigerian Treasury securities, was the cause of the fall that was observed.
As investors continue to look for greater returns on their investments, trading activity on Nigerian Treasury bills ceased abruptly on Monday, according to notes from Cordros Capital analysts.
Due to a record-breaking pocket of transactions, the average yield remained constant at 6.9%. Cordros Capital Limited dealers stated that the average yield ended flat in the short and mid segments throughout the curve. However, due to limited demand for the 339-day to maturity (-1bp) bill, yield decreased at the long end (-1bp).
Elsewhere, the average yield declined by a basis points to 12.1% in the OMO segment, traders said. In the bond segment, trading activities were mixed albeit with a bullish bias.
Fixed interest securities traders reported that the average yield pared by 1bp to 14.4%. Across the benchmark curve, the average yield contracted at the short (-6bps) end.
The market witnessed investors demand for MAR-2024 (-26bps) bond. However, yield expanded at the long (+1bp) end following profit-taking on the JUN-2053 (+8bps) bond. Meanwhile, the average yield was unchanged at the mid-segment.
Last week, yields in the secondary market experienced a decline for most maturities. as investors continue to search for higher returns on their investments to compensate for inflation surge
Fixed income securities traders anticipate that yields in the secondary market will stay relatively calm this week as the market ahead of the forthcoming Treasury Bills Primary Market Auction.
