OVN Rate Shrinks To 3.6%, As N333.31bn OMO matures
The overnight lending rate (OVN) as of Thursday contracted by 930bps to 3.6 per cent, as inflows from OMO maturities totaling NGN333.31 billion boosted system liquidity.
However, the naira strengthened at the Investment and Export (I&E) foreign exchange window by 0.1% to NGN386.00/USD while it was flat at the parallel market at NGN462.00/USD.
The NTB secondary market was mixed, as the average yield was flat at 2.1 per cent. Elsewhere, average yield expanded by 9bps to 5.2% at the OMO secondary market.
Trading in the Treasury bond secondary market was bullish, as average yield contracted by 40bps to 8.1%. Across the curve, yield contracted at the short (-49bps), mid (-65bps) and long (-14bps) segments, driven by demand for the MAR-2024 (-81bps), JUL-2030 (-203bps) and JUL-2034 (-51bps) bonds, respectively.
Analysis of the week’s activities shows that , midweek the Nigerian Naira weakened at the parallel market by 0.4 per cent to NGN462.00/USD, while it was flat at the Investment and Export (II&E) window, at NGN386.50/USD.
The trend midweek, was reverse of the trend recorded on Tuesday, when the naira weakened at the Investment and export (I&E) window by 0.1 percent to NGN386.50/USD while it closed flat at the parallel market at NGN460.00/USD.
But on Monday, the naira strengthened at the I&E window by 0.1 per cent to NGN386.00/USD while it was flat at the parallel market at NGN460.00/USD.
The overnight lending rate on Wednesday contracted by 310bps to 12.9 per cent, following improved system liquidity.
The Treasury bills secondary market was bullish, as average yield contracted by 8bps to 2.1 per cent. Across the curve, yield contracted by 16bps at the short segment and mid segment by -5bps, as market participants demanded the 93DTM instrument by -34bps and 135DTM bill by -27bps, respectively; yield at the long end was flat. Elsewhere, average yield expanded by 9bps to 5.1% at the OMO secondary market.
July 01, trading in the Treasury bond secondary market was mixed, albeit with a bearish tilt, as average yield expanded slightly by 1bp to 8.5 per cent. Across the curve, yield expanded at the short (+2bps) end, as investors sold-off the APR-2023 (+17bps) bond; yields at the mid and long segments were flat.
On Tuesday, the money market & fixed income investment segment saw the overnight lending rate which contracted on Monday, expanded Tuesday by 33bps to 16.0 per cent, in the absence of any significant flows into the system.
The Treasury bills secondary market was bullish, as average yield expanded by 40bps to 2.2 per cent. Across the curve, yield contracted at the mid segment by -13bps, as market participants demanded the 198DTM (-62bps) instrument, while they expanded at the long segment by +139bps following a sell-off of the 345-DTM bill (+296bps); yield at the short end was flat. Similarly, average yield expanded by 4bps to 5.1 per cent at the OMO secondary market.
Trading in the Treasury bond secondary market was bullish on Tuesday, as average yield declined by 8bps to 8.4 per cent. Across the curve, yield contracted at the short (-20bps) and mid segment by -2bps, as investors demanded the APR-2023 bond (-35bps) and FEB-2028 bond (-7bps), respectively; yield at the long end was flat.
It will be recalled that on Monday, the overnight lending rate contracted by 43bps to 15.7 per cent, as system liquidity remains tight.
The Treasury bills secondary market was bullish, as average yield contracted by 8bps to 2.2 per cent. Across the curve, yield contracted at the mid segment by -21bps, as market participants demanded the 122DTM instrument which contracted by -60bps; yields at the short and long ends were flat. Conversely, average yield expanded slightly by 1bp to 5.0% at the OMO secondary market.
Trading in the Treasury bond secondary market was bullish, as average yield declined by 14bps to 8.5%. Across the curve, yield expanded at the short end by 1bp, as investors sold off the JUL-2021 (+16bps) bond, while yield contracted at the mid (-44bps) and long (-9bps) segments, due to demand for the FEB-2028 (-89bps) and MAR-2050 (-27bps) bonds, respectively.
Comments are closed.