The Central Bank of Nigeria (CBN) will on Wednesday roll over treasury bills worth N167.8 billion across the 91-, 182- and 364- Day tenors at the Primary Market Auction (PMA).
Consequently, yields in the secondary market are expected to remain pressured due to high liquidity levels according to analysts at Afrinvest Securities Limited.
Nevertheless, calm trading sessions are anticipated this week as investors interest filter to alternative investments with higher expected returns.
“We therefore maintain our recommendation that investors with higher risk appetites and longer time horizon take advantage of opportunities in available commercial papers or more attractive bonds,” the analysts said.
There was a slightly bullish outing in the Nigerian Treasury Bills secondary market last week, despite quiet trading sessions as financial system liquidity levels remained high at N920.0bn on Friday supported demand in the space.
However, average yield across all tenors marginally declined marginally by 4bps Week-on-Week to close at 0.5%.
A report by Afrinvest noted that demand was observed largely on long-term NT-Bills, with 16-Sep-21 (-32 bps) recording the most buying interests. While the short and medium term maturities experienced flat performances with no change from the previous week.
In the Open Markt Operation (OMO) bills market according to a report by FSDH research, the average yield across the curve increased by 6 bps to close at 0.25 percent as against the last close of 0.19 percent. Selling pressure was seen across short-term, medium-term, and long-term maturities with average yields rising by 4 bps, 11 bps, and 5 bps, respectively.
Yields on 13 bills advanced with the 30-Mar-21 maturity bill recording the highest yield increase of 22 bps, while yields on 13 bills remained unchanged.
At the foreign exchange market, Nigeria’s currency exchanged with the dollar at the rate of between N464 and N465 on the black market on Tuesday.
Naira remained stable at N462 per dollar at the Bureau De Change (BDC) segment of the foreign exchange market.
At the Investors and Exporters (I&E) forex window, Naira remained stable at N385.67 per dollar. Analysts at FSDH research said most participants maintained bids between N380.00 and N393.54 per dollar.
“We expect that the CBN will maintain its current FX rationing stand to keep Naira stable,” the analysts said.
The daily foreign exchange turnover at the I&E window rose significantly by 173.05 percent to $140.95 million on Tuesday from $52.62 millìon recorded on Monday, data from FMDQ indicated.
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