January 3, 2023

Turnover in fixed income, currency market down 1.47% to N15.58trn

Foreign capital inflow rises 60% to $610m, outflow rises faster

By Nkiruka Nnorom

Total turnover in the fixed income and currency market fell marginally Year-on-Year (YoY) by 1.47 per cent to N15.58 trillion in November 2022, from N15.81 trillion recorded in the corresponding period in 2021.

Data from the FMDQ Securities Exchange on the Monthly Financial Report for November 2022, however, show that month-on-month (MoM), the figure rose by 2.04 percent from N15.49 trillion  in October, 2022.

Breakdown of the market activity for the period showed that the Foreign Exchange (FX), Money Market (MM) and Treasury Bills (TBs) transactions dominated secondary market activity in

November 2022, accounting for 77.69%  of the total secondary market turnover.

Specifically, the FX market accounted for chunk of the trading activity during the period with N4.51 trillion or 33.90 percent of the total market transaction, followed by the Money Market, which contributed 23.91percent or N3.32 trillion to the total market turnover, while the TBs accounted for 18.88 percent or N2.51 trillion of the total market turnover.

The OMO and the CBN Special Bill accounted for 16.14 percent or N2.15 trillion of the total market transactions, while the FGN and other bonds accounted contributed 6.69 percent or N0.83 trillion to the total secondary market transactions.

Further analysis of transactions showed that the Fixed Income (FI) market turnover stood at N5.48 trillion, representing a MoM increase of 8.84 percent (N0.45trn) fromN5.04 trillion recorded in October 2022.

The MoM increase in the FI market turnover, according to FMDQ, was driven by the increase in T.bills and FGN bonds turnover which offset the MoM decrease of 35.86% (N1.20trn), and 76.84% (N0.06trn) in CBN Bills1 and Other Bonds turnover respectively.

Also, the total turnover in the Money Market segment decreased MoM by 9.14% (N0.33trn) to N3.32 trillion in November 2022.

The MoM decrease was solely driven by the 9.53% (N0.34trn) decrease in Repos/Buy-backs which offset the 33.84% (N0.01trn) increase in unsecured Placement/Takings turnover respectively.