October 20, 2023/Coronation Research

Summary

• Opening market liquidity was reported at N448.8bn on Friday (13 October ‘23). Last week, call, overnight, and repo rates closed within a range of 1% – 6% as rates in the money market marginally moderated.
• The average NTB yield declined by -147bps to close at 6.5% w/w. Meanwhile, the average yield for OMO bills declined by -3bps w/w to close at 12.1%.
• As for the secondary market for FGN bonds, the average yield declined by -4bps to close at 14.5% w/w.
• In the Eurobond market, the average yield declined by -61bps to close at 12.0% w/w.
• According to the US Bureau of Labor Statistics, headline inflation remained unchanged at 3.7% y/y in September ’23. Inflationary pressures moderated for transportation services (9.1%y/y vs 10.3% y/y), shelter (7.2% vs 7.3%), food (3.7% y/y vs 4.3% y/y), and medical care commodities (4.2% y/y vs 4.5% y/y).
• Meanwhile, according to China’s National Bureau of Statistics, inflation flattened to 0% in September ’23 compared with 0.1% y/y recorded in August ’23. This can be partly attributed to sluggish demand from businesses and households. Deflationary pressure was significant in transport (-1.3% y/y vs -2.1% y/y). However, inflationary pressures persisted for health (1.3% y/y vs 1.2% y/y), non-food (0.7% y/y vs 0.5% y/y), and housing (0.2% vs 0.1% y/y).

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