Bonds Yield Pops Higher as Demand for T-Bills Rises
The average yields on fixed income securities diverged on Wednesday amidst liquidity pressures in the financial system. As money market trends under liquidity pressures, short-term rates were up as the average interbank rate inched upward.
Data from FMDQ Exchange shows that the overnight lending rate remained unchanged at 15.0% as system liquidity closed at a net short position of N160.02 billion, according to Cordros Capital.
Again, in the secondary market, the Nigerian Treasury bills traded with bullish sentiments, as the average yield contracted by 4 basis points to 7.8%. Across the curve, traders said the average yield dipped at the short (-10bps), and mid (-3bps) segments as market participants demanded the 92-day to maturity (-59bps) and the 183-day to maturity (-8bps) bills, respectively.
Meanwhile, the yield was flat at the long end. Elsewhere, the average yield was flat at 11.1% in the open market operation (OMO bills) segment. READ: NGX Pops N195bn as Earnings Releases Boost Sentiment
In the secondary market for FGN bonds, trading activities turned bearish midweek as the average yield expanded by 3 basis points to 12.7%. Sell pressures keep pushing the yield curve higher while the fixed income market trades on mixed sentiment.
Across the benchmark curve, Cordros Capital analysts hint in a market report that the average yield expanded at the short (+19bps) end following profit-taking activities on the MAR-2025 (+99bps) bond.
However, there was contraction at the long (-7bps) end as investors demanded the MAR-2050 (-21bps) bond. Conversely, the average yield was unchanged at the mid-segment. #Bonds Yield Pops Higher as Demand for T-Bills Rises
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