Naira trades flat at N467/$ as DMO allots N103.81bn

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By Joshua lekwachi, Abuja

The naira traded flat at the parallel market at N467 against the Dollar on Thursday but lost 0.55per cent against the Euro to close at N548.

Also at the parallel market, the Naira closed flat against the Pound at N600.

At the Investors & Foreign Exchange (I & EFX) window, while the Naira inched up by 0.88per cent and 0.77 per cent against the Euro and Pound to close at N446.24 and N487.47 respectively, against the Dollar, it closed flat at N386.00.

“Going forward, we expect the FX market to be dictated by heightened dollar demand and CBN FX policies,” analysts at InvestmentOne research explained.

The money market rates were mixed today as Open Buy Back rate closed flat at one per cent, while Overnight rate inched up by 8bps printing at 1.83per cent.

The bond market was positive today as yields declined across most maturities. Consequently, we witnessed the yields on the 5yr and 7yr benchmark bonds decline by 52bps and 72basis points to close at 4.27 per cent and 6.78 per cent respectively, while the yield on the 10yr benchmark bond closed flat at nine per cent.

However, the Debt Management Office of Nigeria (DMO) has issued a total of N103.81 billion worth of bonds, which is about 71.59% of the total amount offered. The allotted amount comprises of N66.97 billion, N25.43billion, N6.81 billion, N4.60 billion respectively, for the 10, 15, 25, and 30-year tenors.

Recall that DMO had earlier announced its offering of the Federal Government bond worth N145 billion. The auctioning of the offer took place on September 23, 2020, and it was oversubscribed by N215.22 billion.

According to recent data by the DMO, verified by; out of the 78, 71,57,104 total bids for the bonds; 50, 13, 7, and 6 bids were successful.

The average yield fell by 7bps to 7.21%, as the yield at the mid-end of the curve contracted the most 13bps to 7.31%. In the short and long end, yields fell by 1bps and 7bps to 4.16% and 9.57% respectively.

The bond auctioned was oversubscribed by 2.48 times. Bid to cover ratio was highest on the 30-year bond by 35.64 times, offered at 8.92% per annum. The 6-year, 15-year, 25-year, and 30-year bonds were offered at 6%, 8.52%, 8.9%, and 8.94% as against 6.70%, 9.35%, 9.75%, and 9.90% at the previous auction.