Culled—Proshare
8/5/2018/Zedcrest Capital
*** IMF Urges Nigeria to Expand Tax Base, Streamline Currency Policy***
Bonds
The Bond market turned bearish, with continued selloffs from offshore players on the medium to long end of the curve. Although we observed some cherry picking by local clients, yields rose significantly higher by c.25bps across the curve. Barring continued strong selloffs from offshore, we expect slight pullback in yields as they are relatively attractive at current levels.
Treasury Bills
The T-bills market remained slightly bearish with yields rising by c.15bps on average. This was following the slight squeeze in system liquidity and some profit taking by market players in anticipation of OMO on Thursday. We expect a further uptick in yields tomorrow, as market players look to refresh their positions at the auction.
Money Market
The OBB and OVN rates declined slightly to 6.00% and 6.60% as there were no significant funding pressures in the market. We expect yields to trend further downwards in anticipation of inflows from OMO maturities and retail FX refunds to banks.
FX Market
The Interbank rate remained stable at its previous rate of N305.75/, with the CBN’s external reserves recorded to have improved by 1.52% to $47.66bn. The NAFEX rate appreciated by 0.07% to N360.64/$, with the total volume traded also rising slightly by 6.7% to $187m. Rates in the Unofficial market however remained stable at N361.40/$.
