OMO maturity inflow muted by 351 billion naira auction outflow: A review of Nigerian markets

The Nigerian markets have experienced a week of stability and bullish trends in trading activities across the Treasury and bond markets. Adamma Mbachu, Head of Currency Trading at Access Bank, provided insights into the market performance and key events during a recent interview on CNBC Africa. The week saw a coupon payment of 51 billion, leading to a bullish sentiment in the bonds market, with the average yield declining to 14.36%. The Treasury Bills market also traded on a bullish note, with activities such as PML auctions and Umo auctions influencing market dynamics. Despite slight changes in yield curves, trading remained relatively stable throughout the week. Looking ahead, market expectations revolve around the MPC meeting outcome, with analysts predicting stable rates across parameters. The Central Bank of Nigeria (CBN) is anticipated to maintain its stance on sustaining FX liquidity to support the Naira, especially amidst declining reserves. The Naira traded at 362 levels against the dollar, with injections from PFIs helping to stabilize the currency. Mbachu forecasts trading continuity at similar levels in the upcoming week, expecting consistency in yield curves and market sentiment. As September comes to a close, the market has witnessed a bullish trend with reduced liquidity impacting rates. Traders are advised to remain cautious and monitor market dynamics closely. The visibility of PFIs in the market post-Fed rate cuts could drive increased activities in the fixed income space, influencing market sentiments. Overall, a sense of stability and cautious optimism prevails in the Nigerian markets as trading progresses.