In June 2023, the Debt Management Office (DMO) conducted Treasury Bills (T.bills) auctions with a total value of N204.50 billion. This figure represents a significant decrease of 36.97% (N119.93 billion) from the previous month’s sales of T.bills, which amounted to N324.43 billion.
The FMDQ Markets Monthly Report for May, which was recently released and accessed by RateCaptain, provided insights into the current state of the Nigerian financial markets. The report indicated that the DMO also sold Federal Government of Nigeria (FGN) Bonds worth N473.16 billion in June 2023. This remarkable figure was achieved through the reopening of one (1) off-the-run and the issuance of three (3) on-the-run FGN Bonds.
The total sale of FGN Bonds demonstrated an impressive 131.43% oversubscription of the offered amount. Moreover, there was a 13.22% decrease (N72.10 billion) in the value of FGN Bonds sold in June 2023 compared to the previous month’s sales of N545.26 billion. The four FGN Bonds maturities that were reopened included two (2) 10-year, one (1) 20-year, and one (1) 30-year bonds.
Notably, the report highlighted that the Central Bank of Nigeria (CBN) did not conduct auctions for Open Market Operations (OMO) Bills in the primary market for the sixth consecutive month in June 2023.
Corporate Bonds and Commercial Papers also featured in the FMDQ Markets Monthly Report. In June 2023, the total value of corporate bonds listed on the FMDQ Exchange amounted to N17.50 billion. This figure represented a 43.55% decrease (N13.50 billion) from the listings in May 2023. The corporate bond listings in June 2023 were solely attributed to a single issuer in the Construction sector, resulting in a total outstanding value of N1,650.34 billion for corporate bonds.
Regarding Commercial Papers, the report stated that the total value quoted on the FMDQ Exchange in June 2023 was N52.13 billion. This figure reflected a significant 68.17% decrease (N111.64 billion) compared to the value quoted in May 2023. The Commercial Papers were issued by various institutions representing sectors such as Financial Services, Manufacturing, Agriculture, Real Estate, and Commodities Trading. Consequently, the total outstanding value of Commercial Papers increased by 4.85% (N38.24 billion) to reach N826.67 billion.
The secondary market turnover on FMDQ Exchange in June 2023 amounted to N21.74 trillion, indicating a 37.78% increase (N5.96 trillion) from the turnover recorded in May 2023. Transactions in Foreign Exchange (FX), Money Market (MM), and CBN Bills dominated the secondary market activity, accounting for 80.49% of the total secondary market turnover.
The report further highlighted that in the FX Market, the US Dollar appreciated against the Naira, with the spot exchange rate ($/N) increasing by 35.07% ($/N162.51) in June 2023. The average spot exchange rate closed at $/N625.90, compared to $/N463.39 recorded in May 2023. Exchange rate volatility also surged in June 2023, with the Naira trading within an exchange rate range of $/N464.67 – $/N770.38.
As for the Fixed Income (FI) market turnover, it reached N7.52 trillion in June 2023, signifying an 18.21% increase (N1.16 trillion) from May 2023’s turnover of N6.36 trillion. The MoM increase in FI market turnover was driven by upticks in turnover across T.Bills, CBN Special Bills, and FGN Bonds, which compensated for the decreases in turnover for OMO Bills and Other Bonds.
The FMDQ Markets Monthly Report serves as a valuable resource for investors and market participants, offering insights into the performance of various financial instruments and the overall state of the Nigerian financial markets.
