Weekly Market Insights: Global Trends and Local Implications
- System liquidity declined by 18.41% to N3.78 trillion from N4.63 trillion in the previous week, largely reflecting the impact of the CBN’s CRR debits, a private OMO auction and the FGN bond auction, through which the DMO allotted N929.32 billion.
- Looking ahead, an estimated N2.56 trillion is expected to flow into the financial system this week, with OMO maturities accounting for about 85% of the projected inflows.
- The CBN is scheduled to conduct a N700 billion Treasury bill auction this week, comprising N100billion in 91-day bills, N100 billion in 182-day bills and N500 billion in 364-day bills.
- Nigeria’s external reserves surpassed the $52 billion mark for the first time since January 2009, rising to $52.03 billion as sustained FX inflows continued to strengthen the country’s external position.
- Renewed geopolitical tensions in the Middle East continued to keep crude oil prices elevated, with average Brent crude rising by 10.92% during the week to US$94.35 per barrel.
- The DMO successfully conducted its FGN bond auction during the week, allotting approximately N929.32 billion across the three re-opened instruments. The auction attracted strong investor demand, with total subscriptions reaching about N1.74 trillion against N1.20 trillion offered.
- Demand was broad-based across all maturities, with the 16.2499% FGN APR 2037 reopening recording the strongest investor interest. The positive auction outcome, together with the revised Q3 issuance calendar signalling lower planned bond supply, helped reinforce bullish sentiment in the secondary market and contributed to the decline in bond yields.
