SAT 15 JAN, 2022-theGBJournal- The Treasury bonds secondary market was bullish following improved demand from investors as they cherry-picked attractive instruments across the curve.
Consequently, the average yield declined by 7bps to 11.5%. Buying activities was witnessed across the benchmark curve, as the average yield contracted at the short (-14bps), mid (-3bps), and long (-8bps) segments, mostly on the APR-2023 (-29bps), MAR-2027 (-7bps) and JUL-2034 (-41bps) bonds, respectively.
Notably, the DMO published the Q1-22 bond issuance calendar on Wednesday, which showed the total volumes offered at c. NGN420.00 – 480.00 billion. Also, only the short (a JAN-2026 re-opening) and long (a JAN-2042 new issue) dated instruments are on offer.
In the short term, we expect frontloading of significant borrowings for the year to result in an uptick in bond yields as investors demand higher yields in the face of elevated supply.
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