Market News

By Helen Oji

The Debt Management Office (DMO) has sold treasury bills (T-bills) valued at N406.9 billion across its auctions in October 2023, representing a 25.2 per cent (N137.15 billion) month-on-month (MoM) decrease on the value of T-bills sold across its auctions in September 2023 (N544.05 billion).

Similarly, the DMO sold federal government bonds worth N374.8 billion via the reopening of two 10-year, a 15-year and a 30-year FGN bond in October 2023.

According to FMDQ Securities Exchange Secondary Market Segment, in October the total sale represented a 104.1 per cent oversubscription of the amount offered and an 18.4 per cent (N58.27 billion) MoM increase on the amount sold in September 2023 (N316.49 billion) for the same FGN Bond maturities.

Also, within the same period, the CBN sold open market operation (OMO) bills worth N400 billion in its second public OMO Bills auction in 2023.

The exchange noted that non-sovereign bonds worth N23 billion were listed on FMDQ Exchange in October 2023, representing an 80 per cent (N92 billion) MoM decrease from September 2023 listings.

It explained that the non-sovereign bond listings emanated solely from a corporate issuer in the financial services sector. As a result, the total outstanding value for non-sovereign bonds increased marginally MoM by 0.4 per cent (N7.72 billion) from N2,180.27 billion in September 2023 to N2,187.99 billion in the review month.

Further, the total value of commercial papers (CPs) quoted on FMDQ Exchange during the period was N36.5 billion, representing a MoM decrease of 75.03 per cent (N109.71 billion) from the value of CPs quoted in September 2023.

Quoted CPs were issued by institutions from various sectors including financial services (five), manufacturing (five), agriculture (two), health and pharmaceuticals (one) and real estate (one).

As a result, the total outstanding value for CPs increased MoM by 2.39 per cent (N22.15 billion) to N948.56 billion in October 2023.

For FX Derivatives Market, a total turnover of $1.55 billion (N1.22trn) was recorded in the segment in October 2023, representing a MoM decrease of 39.27 per cent ($1 billion) from September 2023 figures.

The MoM decrease in the FX derivatives turnover was jointly driven by the 40.19 per cent ($0.86 billion), 28 per cent ($0.07 billion) and 52.94 per cent ($0.09 billion) decrease in transactions across FX Swaps, FX Forwards and FX Futures, respectively.

In the Cleared Naira-Settled Non-Deliverable Forwards market, the near-month contract (NGUS OCT 25, 2023) expired and open positions with a total notional value (NV) of $0.74 billion were settled.

As a result, the cumulative NV of open Cleared Naira-Settled Non-Deliverable Forwards contracts decreased for the fourth consecutive month to circa $4.16 billion as of October 31, 2023.

This represents a MoM decrease of 15.3 per cent ($0.75 billion) and YoY increase of 1.22 per cent ($0.05 billion) from its value as of September 29, 2023, and August 31, 2022, respectively.

In October 2023, there were no rates quoted for cleared naira-settled non-deliverable forwards. Conversely, indicative non-deliverable FX Forwards rates increased across all tenor buckets. The farthest-term 12-month contracts recorded the highest MoM increase in price.