June 19, 2024/Coronation Research

Summary

• Opening market liquidity was reported at N132.6bn on Friday (14, June ‘24). Call, overnight, and repo rates closed within the range of 6% – 26%, as rates in the money market moderated.
• Last week, the average NTB yield declined by -10bps to close at 21.9% w/w.
• The average yield for OMO bills declined by -10bps to close at 21.8% w/w.
• Meanwhile, in the secondary market for FGN bonds, the average yield increased by +10bps to close at 18.8% w/w.
• In the Eurobond market, the average yield increased by +10bps at 10% w/w.
• According to the US Bureau of Labor Statistics, U.S. inflation moderated to 3.3% y/y in May ’24 from 3.4% y/y recorded in April ’24. This reading marks the third consecutive moderation since March ’24. The moderation was evident in food prices (+2.1% y/y vs +2.2% y/y), shelter (+5.4% y/y vs 5.5% y/y), transportation (+10.5% y/y vs +11.2% y/y), and apparel (+0.8% y/y vs 1.3% y/y). Meanwhile, inflationary pressure persisted in energy costs (+3.7% y/y vs +2.6% y/y).
• Meanwhile, Eurozone inflation increased to 2.6% y/y in May ’24 from 2.4% y/y recorded in April ’24. Inflationary pressure was significant in energy (+0.3% y/y vs -0.6% y/y), services (+4.1% y/y vs +3.7% y/y). Meanwhile, prices slowed for food, alcohol and tobacco (+2.6% y/y vs +2.8% y/y), and energy industrial goods (+0.7% y/y vs +0.9% y/y).

For the full Coronation fixed income and exchange rate (CFEX) update, please click here