Bond Market Update: The odds remain in favour of low interest rates

Must Read

List of United Bank for Africa (UBA) Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number that usually identifies both the bank and the branch where an account is held. The sort...

How To Block Your Bank Account And SIM Card In Case Of Emergency

Losing your phone and wallet or having them stolen can be very frustrating. However, in case that happens to...

List of Access Bank Sort Codes & Branches (with addresses) in Nigeria

The sort code is a number which usually identifies both the bank and the branch where an account is...
- Advertisement -

Last week, the Debt Management Office (DMO) on behalf of the Federal Government of Nigeria (FGN) published the Bond offer circular for Oct-2020. To the surprise of many market participants, the circular revealed that the FGN plans to raise only N30.0bn split equally between the re-opened 15-year and 25-year notes, at the auction scheduled for today (21/10/2020).

Notably, the expectation of low paper supply at the primary market auction and the robust state of the financial system, liquidity has since spurred buying frenzy at the secondary bond market, with yields collapsing to the lowest level since data became available in 2007. This is despite the existence of pressures that continue to stoke headline inflation rate higher – with the latest Sept-2020 figure showing inflation is now at a 31-month high of 13.71% y/y while 30-year note issued during the period was sold at the rate of 8.94%.

Overall, our estimate showed that the DMO has already issued above 90.0% of its planned
domestic issuance for the fiscal year 2020.

Accordingly, this suggests the government supply of securities will remain thin for the rest of the year even as liquidity at the interbank market remains buoyant, thanks to expected inflows from OMO maturities (N3.3tn), and three outstanding FAAC disbursements before the year ends. Against this backdrop, we expect rates at both the primary and secondary bond market to remain depressed till the end of the

Read Also:  Stanbic IBTC Reinforces Value Proposition In New Brand Campaign

UNITED CAPITAL RESEARCH

- Advertisement -
Bond Market Update: The odds remain in favour of low interest rates - Brand SpurBond Market Update: The odds remain in favour of low interest rates - Brand Spur

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.

- Advertisement -

LEAVE A REPLY

Please enter your comment!
Please enter your name here
Read Also:  ARTIFICIAL INTELLIGENCE AND THE BANKING SECTOR

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Bond Market Update: The odds remain in favour of low interest rates - Brand SpurBond Market Update: The odds remain in favour of low interest rates - Brand Spur

Latest News

May & Baker Nigeria appoints new Executive and Managing Director as Nnamdi Nathan Okafor takes a bow

Sequel to the Board Meeting of May & Baker Nigeria Plc held on Thursday, 26th November 2020 at the...

Household Consumption Expenditure Contracts By -0.08% in Q2 2020 – NBS

In the first quarter of 2020, Nigeria's real GDP at basic prices grew by 1.87% but declined in the second quarter by -6.10% on a...

NSE Migrates 4 Companies from ASeM to Growth Board

The Nigerian Stock Exchange (NSE) is pleased to announce the migration of Chellarams Plc, Living Trust Mortgage Plc, McNichols Plc, and The Initiates Plc...

Fidelity Bank’s MD/CEO Designate purchases 5 million shares

Fidelity Bank Nigeria Plc has announced that its Managing Director/CEO Designate, Mrs. Nneka Onyeali-Ikpe has increased her stake in the business via the purchase...

Chinese FMCG companies win 82 million new customers

Despite challenges due to the pandemic, 19 out of the top 22 FMCG companies in China grew their shopper base this year. The top 22...
- Advertisement -
BrandsPur Weekly Cartoons
- Advertisement -Bond Market Update: The odds remain in favour of low interest rates - Brand SpurBond Market Update: The odds remain in favour of low interest rates - Brand Spur