SAT, JULY 08 2023-theGBJournal |The Nigerian Treasury bills and FGN Bonds secondary market remained bullish.
At the Treasury Bills market, the average yield across all instruments contracted by 6bps to 6.3%, supported by the liquidity surfeit in the system.
Notably, market participants showed an affinity for instruments at the long spectrum of the curve, particularly the 245DTM (-168bps) and 231DTM (-61bps) bills.
For next week, we still expect T-bills yields to remain tempered, supported by the buoyant liquidity conditions.
Also, we expect market participants to be keen on next week’s primary market proceedings, with the CBN expected to roll over N141.77 billion worth of instruments at the NTB PMA holding on Wednesday (12 July).
At the FGN Bonds market, proceedings remained bullish this week, as the average yield across all instruments contracted by 4bps to 13.0%. Across the benchmark curve, the average yield advanced at the short (+22bps) and mid (+12bps) segments following profit-taking on the MAR-2027 (+115bps) and APR-2032 (+42bps) bonds, respectively.
Meanwhile, the average yield contracted at the long (-25bps) end, as investors demanded the APR-2049 (-85bps) bond.
We retain our view that frontloading of significant borrowings for the year by the FG will result in an uptick in bond yields as investors demand higher yields in the face of elevated supply.
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