April 3, 2025/Coronation Research

Summary

• Last week, system liquidity closed positive at N969.77bn (28th March, ’25) from -N1.96trn in the previous week, reflecting increased market liquidity. Consequently, the Open Repo Rate (OPR) decreased by 590bps to 26.50%, while the Overnight Rate (O/N) also decreased by 594bps to 26.96%. We expect interbank rates to remain elevated barring any significant inflows
• Average yields in the Nigerian Treasury Bills (NTB) segment increased by 15bps to close at 19.44% w/w. The short segment of the curve declined by 7bps to close at 17.84%, the medium segment of the curve increased by 95bps to close at 18.90%, and the long segment of the curve increased by 7bps to close at 20.65%.
• In the NTB auction last week, the stop rate for 91-Day tenor was 18.00%, the stop rate for the 182-Day tenor was 18.50%, and the stop rate for the 364-Day tenor was 19.63%. There was an oversubscription of N730.35bn.
• In the secondary market for Open Market Operation (OMO), average yields increased by 168bps closing at 24.20% w/w.
• In the secondary market for Federal Government of Nigeria (FGN) bonds, the average yields decreased by 3bps across the benchmark curve to close at 18.71% w/w. In the short end of the curve, there was a decline of 24bps to close at 19.06%, in the medium end, there was an increase of 14bps to close at 19.08%, and for the long end, there was an increase of 12bps to close at 17.64%.
• In the FGN bond auction last week, the marginal rate for the 5-year tenor was 19.00%, while the marginal rate for the 9-year tenor was 19.99%. There was an undersubscription of N140.931bn for the 5-year tenor and an oversubscription of N371.241bn for the 9-year tenor.
• Trading activity in the Eurobond market was bearish as average yields increased by 13bps to close at 9.64%.
• Bonny Light increased from US$74.04/bbl to US$76.66/bbl, signaling an increase in global demand for crude oil. UK Brent grew from US$71.61/bbl to US$73.63/bbl and WTI also grew from US$67.89/bbl to US$69.36/bbl.

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