Yields contracted in the Nigerian fixed income market with all the NIBOR short term rates contracting except the call rate which remained flat at 1%. Much of the contraction is on the 6m rate with a 44 basis points contraction to close at 12.3776 while the 1M and 3M rates contracted by 14 and 6 basis points to close at 10.6283 and 9.3292 respectively.Source: FMDQ
FGN Bond yields are mixed in their behaviour as the long end of the curve declined mildly while the medium and short end showed marginal expansion. Almost all the FGN maturing before and/or around 2017 recorded price decreases arising from yield expansions while those maturing thereafter witnessed price increases from the contraction in their respective yields. The same behaviour holds true for Agency Bonds as well Sub National or State Bonds.
Nigeria Bond Index
A look at the Bond Index reveals that the 5Yr Index changed by 4bsp and -9bsp respectively. Consequently, the 3 5Yr Index price increased to 1,494.26 from 1,485.72 recorded the day before.
At the end of the day, the total Bond Market Index witnessed a marginal decline in yield of 3bsp with its price trending slightly up from 1315.84 to 1317.71
With the maturity of NBL Commercial Paper, it is believed that liquidity in the system will continue to be high at least in the short time which may lead to further decline in yields going into the new year.
This information is obtained from sources and data considered to be reliable, but its accuracy and completeness is not guaranteed by Quantitative Financial Analytics LTD