Nigerian Treasury Bills Yield Tumbles to 4.3%
The average yield on Nigerian Treasury bills (NTB) registered a sharp decline as buying momentum on naira assets extended into the second week of the New Year.
Falling to 4.3%, the average yield has been reacting to changing market dynamics and liquidity levels in the financial system. Money market rates also drop due to the absence of funding pressures in the system.
Data from the FMDQ platform showed that the overnight lending rate contracted by 640 basis points to 8.5%, though there were no significant inflows into the system.
Key money market rates, including the open repo rate (OPR) and overnight lending rate (OVN), decreased by 7.20% and 6.40% to close lower at 7.05% and 8.50%, respectively, Cowry Asset said in a note.
Fixed income investors gauge market temperature to redesign their portfolio strategy for the New Year amidst expectations for yield repricing as inflation continues to rise.
Trading activities in Nigerian Treasury Bills ended on a bullish note in the secondary market. Analysts noted positive movement at the mid and longer end of the yield curve led to a large decline in the average yield.
Across the curve, Cordros Capital Limited said in an update that the average yield closed flat at the short end but declined at the mid (-146bps) and long (-195bps) segments.
This happened following buying interests in the 171-day to maturity (-288bps) and 213-day to maturity (-383bps) bills, respectively. Similarly, the average yield dipped by 246bps to 8.4% in the OMO segment. NBS And The Task of Delivering Reliable National Data
The investment firm also said proceedings in the FGN bonds secondary market traded with mixed sentiments, albeit with a bullish tilt, as the average yield pared by 1bp to 13.8%.
Across the benchmark curve, the average yield closed flat at the short and mid segments but pared at the long (-1bp) end as investors demanded the JUN-2053 (-9bps) bond.
