March 17, 2022 FX, Money Market, Fixed Income Summary Report

The naira fell by 0.04% to trade at NGN416.67/USD in the I & E exchange window while it stayed flat in the CBN interbank market, trading at NGN416.34/USD.

The differential on the parallel market, on the other hand, shrank even further as the margin of difference closed, so it trades between NGN580/USD and NGN582/USD if you are buying. However, sales on the parallel market fluctuate between NGN555/USD and NGN570/USD. This depends squarely on the amount you want to sell, your location, and your negotiating prowess. 

The inflation rate, MPR/lending rate, and foreign reserves remained unchanged at 15.70%, 11.50%, and $38.78 billion, respectively.

The overnight lending rate, which is the interest rate banks charge themselves when they borrow from each other in the overnight market, widened by 8 basis points from 5.17% to 5.25% as a result of outflows from NTB issuances totaling NGN114.57 billion.

The secondary market for NTB notes was less upbeat, with the average yield closing flat at 3.1 percent. The CBN offered NGN58.04 billion for sale in yesterday's NTB auction, with a total subscription of NGN364.65 billion. As a result, the CBN established stop rates for 91-day bills of 1.74 percent (previously 1.75 percent), 3.00 percent (previously 3.28 percent), and 4.00 percent (previously 4.10 percent), NGN6.85 billion for 182-day bills, and NGN159.85 billion for 364-day bills.

The OMO market's average yield remained unchanged at 3.8 percent.

The secondary market for treasury bonds was mixed, as the average yield fell by 9 basis points. The average yield on the benchmark curve decreased at the short end as investors demanded the APR-27, 2023 (-34bps) and MAR-14, 2024 (-1bp) bonds, but grew at the mid-end with MAR-17, 2027 (+23bps), APR-26, 2029 (+36bps), JUL-23, 2030 (+34bps) bonds and MAR-27, 2035 (16bps) bonds due to some market participants' sell-off activities.