SAT AUG 31 2024-theGBJournal| Bullish sentiments persisted in the FGN bonds secondary market amid pockets of offers on the short – and mid – dated bonds. Consequently, the average yield declined by 67bps to 19.0%.
Across the benchmark curve, the average yield contracted at the short (-89bps), mid (-90bps), and long (-49bps) ends, following demand for the MAR-2025 (-203bps), JUN-2033 (-115bps), and MAR-2050 (-163bps) bonds, respectively.
Cordros Research analysts say they anticipate further moderation in yields, as investors believe we have reached the peak of yields amid a reduced government borrowing profile over H2-24.
Nonetheless, we maintain our medium-term expectation of yields remaining elevated consequent to anticipated monetary policy administration globally and domestically and sustained imbalance in the demand and supply dynamics.
Meanwhile, The FGN Eurobonds Market began on a somber note owing to the bank holiday. Nonetheless, the bulls held their grip.
The United States Consumer Sentiment Index improved in August to 103.3 from 101.9 prior. Additional data showed that the economy expanded by 3.0% in Q2, contrary to 2.8% expected. Also, the initial Jobless claims data printed at 231K vs 232k expected and 233k prior.
Friday, the Fed’s preferred inflation gauge, PCE YoY printed at 2.6% against 2.7% expected and 2.6% prior, solidifying market expectations of a September rate cut. Week-on-week, the average benchmark yield declined by 194bps to close at 8%
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