SAT MAY 25 2024-theGBJournal| Treasury bonds secondary market stayed muted for most of the week but interest in longer-dated instruments on Friday, the last trading day of the week caused the average yield to decline by 2bps to 18.7%.
Across the benchmark curve, the average yield advanced at the short end (+4bps) as investors sold off the MAR-2025 bond (+12bps) but closed flat at the mid segment.
Meanwhile, the average yield contracted at the long end (-9bps) following demand for the JAN-2042 bond (-59bps).
We envisage yields in the FGN bonds secondary market to increase in the near term following the 150bps hike in the MPR to 26.25% by the monetary authorities on Tuesday in its effort to rein in inflationary pressures.
Similarly, the FGN Eurobond market witnessed a bearish week on the back of hawkish comments from FED officials, FED minutes which highlighted willingness to tighten policy further over lack of progress on inflation.
This week, the S&P Global Manufacturing and Services PMI improved to 50.9 and 54.8 from 50 and 51.30, surpassing estimates.
Also, the Michigan Consumer Sentiment Index printed at 69.1 vs 67.5 estimate (67.4 prior).
WoW, the average benchmark yields climbed 22bps, settling at 9.75%.
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