TUE, JUNE 06 2023-theGBJournal |At the NTB segment of the treasury bills secondary market Tuesday, trading was mixed as market participants stayed on the sidelines in anticipation of Wednesday’s auction results.
Thus, the average yield stayed flat at 6.4%.
This is in contrast to last week when the secondary market for T-bills closed on a bullish note with average T-bill yields declining by 44bps to 6.35% as system liquidity continued to remain buoyant.
At the longest available maturity, the yield on a 328-day T-bill fell to 8.04% compared with a yield on a 335- day T-bill of 8.75% a week earlier.
Trading in the FGN bond secondary market was bullish, as the average yield contracted by 3bps to 13.8%.
Across the benchmark curve, the average yield declined at the short (-3bps), mid (-5bps), and long (-3bps) segments following buying interests in the FEB-2028 (-12bps), APR-2032 (-11bps) and APR-2049 (-14bps) bonds, respectively.
Last week, average yields in the secondary market for Federal Government of Nigeria (FGN) bonds sustained their bullish note with average yields declining by 10bps to 13.88%. Yields moderated at the mid-end (-17bps to 14.19%) and long-end of the curve (-9bps to 15.24%) while yields at the short end (+3bps to 10.87%) advanced higher.
Over the course of the year, Coronation Research analysts say they expect the overall direction of T-bill and FGN bond yields to be upward as increases in government borrowing are felt by the market.
”Here again, however, we need to keep a close eye on the incoming administration’s approach to interest rates, noting that it aspires to keep interest rates low.”
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