Market Commentary

29 April 2019 : The CBN once again held off conducting an OMO auction at the start of the week; however, system liquidity moderated to N 174 billion. Subsequently, the Interbank Call rate advanced 143bps d/d to settle at 17.86%.

In the secondary T-bills market, trading was mildly positive, with average yields declining 2bps as soft buy-side sentiment was observed across the space. Specifically, activity appeared to be concentrated on the short-to-mid end of the space. Meanwhile, the bond space was mixed with a slightly positive tilt, as investor interest in short-term maturities outweighed sell pressure on the longer end of the bond space. Ultimately, benchmark yields declined 1bp.

Market Outlook

We expect the CBN to continue its infrequent conduct of liquidity mop-ups; however, due to the official postponement of this week’s PMA to Thursday due to the public holiday, we foresee mild buy-side activity, driven by a possible build-up of demand. Concurrently, we expect the bond space to also trade mixed, with investors likely to favour bargain-hunting on attractive bonds.

Reporting for EasyKobo on Monday ,29 April 2019 in Lagos, Nigeria

Source: Vetiva Capital Management Limited