DAILY MARKET REPORT: FIXED INCOME, MONEY MARKET AND FX – JUNE 15 2017

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The Consumer Price Index (CPI) which measures inflation increased by 16.25% (YoY) in May 2017. This was 0.99 percent points lower than the rate recorded in April (17.24%). On a month-on-month basis, the Headline index increased by 1.88 percent, 0.28 percent points higher than the rate of 1.60% recorded in April 2017.

The Fixed Income market was on a bullish run with significant demand especially on the short end of the market (T-bills). The ab- sence of an OMO auction, coupled with the improvement in mar- ket liquidity supported buying sentiments across all trading T-bills. Yields compressed by about 60bps with a deep rally on short term T-bills maturities (170bps drop) . The FGN bond market also wit- nessed slight buys on the back of the retracement in inflation fig- ures. We expect the bullish sentiments in the T-bills space to per- sist closing the week. Bonds are likely to trade flat as we approach the auction next week.

As expected, Interest rates plummeted today to close at 6% lev- els due to the N205billion OMO maturity credited into the system. The absence of an OMO auction and FX sales by the CBN support- ed the sharp improvement in market liquidity. We expect interest rates to close the week on a calm note, however, the CBN will be poised to mop up excess funds from the system.

ECONOMIC INDICATORS
Inflation (YoY) 16.25%
Exchange Rate ($) N305.25
MPR 14.00%
Foreign Reserves $30.22Bn
Brent Crude $46.83

 

FGN Bonds
Description Bid (%) Offer (%) Day Change (%)
16.00 29-Jun-19 16.45 16.38 (0.07)
15.54 13-Feb-20 16.38 16.31 (0.01)
14.50 15-Jul-21 16.38 16.31 (0.02)
16.39 27-Jan-22 16.18 16.11 0.00
14.20 14-Mar-24 15.94 15.87 (0.01)
12.50 22-Jan-26 16.14 16.07 0.04
12.50 22-Jan-27 16.27 16.2 (0.02)
12.15 18-Jul-34 15.98 15.91 (0.01)
12.40 18-Mar-36 16.02 15.95 0.02
FGN Treasury Bills
Description Bid (%) Offer (%) Day Change (%)
3-Aug-17 18.40 18.15 (0.60)
14-Sep-17 14.09 13.84 (3.01)
5-Oct-17 19.00 18.75 (0.15)
2-Nov-17 18.85 18.6 (0.05)
4-Jan-18 18.60 18.35 (0.30)
1-Feb-18 18.65 18.4 (0.20)
1-Mar-18 18.50 18.25 0.00
5-Apr-18 18.55 18.3 (0.10)
3-May-18 18.45 18.2 (0.10)
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Money Market Rates
Current (%) Previous (%)
Open Buy Back (OBB) 6.33 16.33
Overnight (O/N) 6.75 17.33
FX Market
Current (N/$) Previous ( N/$)
Interbank 305.25 305.70
CBN SMIS 320.00 320.00
I&E FX Window 365.07 367.17
Parallel Market 365.00 365.00
                             Primary Market Auction  Results    
NTB – 14 June 2017
Tenor Rate (%) Offer (N’Bn) Sub (N’Bn) Sale (N’Bn)
91 days 13.50 39.06 39.20 39.06
182 days 17.30 23.02 24.79 23.02
364 days 18.69 174.64 201.20 174.64
FGN Bond Offer– 21 June 2017
Tenor Rate (%) Offer (N’Bn) Sub (N’Bn) Sale (N’Bn)
Jun-21 TBD 40.00 N/A N/A
Mar-27 TBD 50.00 N/A N/A
Apr-37 TBD 50.00 N/A N/A
OMO – 13 June 2017
Tenor Rate (%) Offer (N’Bn) Sub (N’Bn) Sale (N’Bn)
184 day 18.00 5.00 0.32 0.32
352 day 18.60 10.00 1.80 1.80
Read Also:  Food prices still up as inflation rate falls for the first time in 15 months

 

Eurobonds
Issuer Description Yield (%) Day Change (%)
FGN 6.38 12-Jul-23 5.73 0.14
FGN 7.875 16-Feb-32 6.95 0.08
Fidelity Bank 6.88 09-May-18 12.58 0.02
GT Bank 6.00 08-Nov-18 4.32 0.00
Zenith Bank 6.25 22-Apr-19 5.38 0.02
First Bank 8.25 07-Aug-20 10.65 0.05
Access Bank 7.677 24-Jun-21 9.37 0.04

 

(FMDQ, CBN, Bloomberg, Zedcrest research)

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DAILY MARKET REPORT: FIXED INCOME, MONEY MARKET AND FX – JUNE 15 2017 - Brand SpurDAILY MARKET REPORT: FIXED INCOME, MONEY MARKET AND FX – JUNE 15 2017 - Brand Spur

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DAILY MARKET REPORT: FIXED INCOME, MONEY MARKET AND FX – JUNE 15 2017 - Brand SpurDAILY MARKET REPORT: FIXED INCOME, MONEY MARKET AND FX – JUNE 15 2017 - Brand Spur

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