January 29, 2025/Coronation Research

Summary

• Last week system liquidity rebounded into the positive zone, closing at N211.80bn, primarily driven by FAAC and Remita inflows. The Open Repo Rate (OPR) and Overnight Rate (O/N) narrowed by 16.49% and 16.03% respectively, ending the week at 27.00% and 27.50%. We expect interbank rates to remain at current levels.
• Sentiment in the T-bills market was bullish last week buoyed by strong buying interest. The average yields declined by 38bps to close at 24.83% w/w. At the T-bills primary auction last week, the CBN offered N530bn, but allotted N756.01bn worth of T-bills to market participants. The stop rates for the 91-day and 182-day were held steady at 18.00% and 18.50% respectively. Meanwhile, the stop rate for the 364-day instrument moderated to 21.80% from 22.62%.
• The average yields for OMO bills eased by +31bps to close at 28.03% w/w.
• Meanwhile, trading activity in the secondary market for FGN bonds was bearish as average yields increased by +65bps to close at 20.72% w/w.
• In the Eurobond market, the average yields declined marginally by 2bps to close at 9.42%.

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