OMO Bills Drove 72% of N36.52bn Fixed-income Trades in August

Open Market Operation (OMO) bills accounted for about 72 per cent of the N36.52 billion face value traded in Nigeria's fixed-income market in August. The Central Bank of Nigeria (CBN) Fixed Income Dashboard recorded 9,187 trades between August 1 and 31, involving 29 participants across OMO bills, Treasury bills, FGN Bonds and Sukuk.

OMO bills lead by value and yield

OMO bills recorded 4,032 trades with a face value of N26.19 billion. That represented 71.7 per cent of the total N36.52 billion traded during the period. The OMO figure was more than four times the N5.69 billion recorded in Treasury bills and about 5.7 times the N4.59 billion traded in FGN Bonds.

The dashboard put the closing OMO yield at 22.67 per cent, against a weighted average yield of 20.96 per cent for the tenor displayed. That made OMO bills the highest-yielding instrument tracked in the month.

Treasury bills and FGN Bonds still strong on volumes

Treasury bills came next with 2,666 trades valued at N5.69 billion, while FGN Bonds recorded 2,471 trades worth N4.59 billion. Sukuk accounted for only 18 trades valued at N40.11 million.

Although OMO bills had the largest traded value, Treasury bills and FGN Bonds together generated more transactions. The two instruments recorded a combined 5,137 trades, compared with 4,032 for OMO bills.

OMO bills attracted 28 participants, the same number recorded for Treasury bills. FGN Bonds had 26 participants, while only five participants traded Sukuk during the period.

FGN Bond yields stay within 16 to 17 per cent range

FGN Bond yields were mostly within the 16 per cent to 17 per cent range across the displayed tenors. Closing yields included 17.17 per cent, 16.23 per cent, 17.15 per cent, 16.41 per cent, 17.15 per cent, 17.25 per cent, 17.10 per cent and 17.30 per cent. The dashboard also showed weighted average FGN Bond yields of 17.10 per cent and 17.23 per cent among the displayed tenors.

With OMO bills taking nearly three-quarters of the month's traded value, August's fixed-income activity was clearly skewed towards the short-term instrument, even as Treasury bills and FGN Bonds maintained a sizeable share of transaction volumes.

For investors and businesses watching the naira, the heavy OMO activity signals continued central bank liquidity management through high-yield short-term instruments. That keeps money market rates elevated and reinforces the appeal of naira assets for yield-seeking portfolios.