…DMO to roll over N108.13 billion worth of maturities
SAT, OCT 21 2023-theGBJournal|This week, activities in the Treasury bills secondary market were bearish as market participants continued to exit positions across the mid and long segments of the curve.
As a result, the average yield across the market expanded by 40bps to 7.2%. Across the market segments, the average yield advanced by 39bps to 6.9% in the NTB secondary market but contracted by 3bps to 12.1% in the OMO segment.
In the coming week, Cordros Research analysts say the envisage lower yields in the T-bills secondary market as we believe the liquidity surfeit in the financial system will drive the demand for bills.
In addition, the DMO is scheduled to hold an NTB PMA on Wednesday (25 October), where it will roll over N108.13 billion worth of maturities.
Meanwhile, the overnight (OVN) rate expanded by 53bps w/w to 2.2%, as the debits for FGN bond PMA (N374.76 billion) and late CRR (N160.00 billion) outweighed the inflows from FGN bond coupon payments (N145.98 billion) and CRR refunds.
Nonetheless, we highlight that the rate remained at single digits throughout the week, as the average system liquidity closed at a net long position of N454.07 billion (vs. a net long position of N479.10 billion in the previous week).
Barring significant outflows next week, we expect the OVN rate to remain depressed as inflows from FGN bond coupon payments (N285.82 billion) will likely keep the system liquidity afloat.
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