January 7, 2025/Coronation Research

Summary

• System liquidity closed positive at N476.24bn (03 Jan ’25). Call, overnight and repo rates closed within a range of 7.63- 27.25%. Rates in the money market tightened as debits from the OMO auction and CRR outweighs Remita inflows driven by Government payments to contractors. We expect interbank rates to remain stable, supported by OMO maturities, barring any significant outflows.
• In the secondary market for T-bills, average yield eased by 3bps to 25.46% pa
• The market for OMO bills was bearish, the average yield for OMO bills increased by 7bps to 27.18% pa, reflecting demand for higher yields. At the OMO primary auction last week, the CBN offered and allotted N500bn worth of 358-day and 365-day OMO bills to market participants. The stop rates stood at 23.93% and 23.95%, translating to effective yields of 31.46% and 31.49% respectively.
• The secondary market for FGN Bond witnessed low trading activity, with the average yield increasing by 3bps across the curve, to settle at 19.78% pa. Selloffs were observed at the short end of the curve, with average yields closing at 20.91% pa. The medium end of the curve saw a marginal yield movement, while trading at the long end of the curve remained muted, with average yield closing at 17.74% pa.
• The Eurobond market exhibited a bullish sentiment as average yield declined by 18bps to 9.49%, driven with strong demand for the 21-NOV-2025 bill.

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