Money Markets

System liquidity remained under pressure throughout the week, primarily due to net CRR debit activities, swap rollovers, and foreign exchange settlements. Despite some improvements from OMO maturities and Remita inflows, liquidity stayed negative. As a result, interbank rates remained elevated, with the Overnight Policy Rate (OPR) and Overnight Rate (O/N) fluctuating but closing the week at 32.33% and 32.75%, respectively. Overall, the OPR increased by 5.04% w/w, and the O/N rose by 4.89% w/w.

Outlook: Interbank market rates are expected to stay at their current levels unless significant inflows occur to address the liquidity issues.

Treasury Bills

The Treasury bills market saw sustained bullish activity throughout the week, particularly at the long end of the curve, with high demand for bills maturing between November 2025 and January 2026. Notable interest was observed in the December 2025 and January 2026 bills. Activity on the short end of the curve was limited due to a wide bid-ask spread. As the week closed, trading activity slowed, with participants selectively engaging across the spectrum. Overall, the average mid-rate for benchmark NTB papers declined by 34bps to 22.63%.

Outlook: We expect cautious trading activity as participants prepare for the NTB auction next week.

FGN Bonds

The local bonds market traded with a bearish sentiment throughout the week, with mid-dated papers such as the February 2031 and May 2033 bonds seeing offers at 22.10% and 21.20%, respectively. Selling pressures persisted, focusing on mid to long-dated papers, including February 2031, February 2034, and June 2053. Despite some demand for the February 2031 and February 2034 bonds, overall activity remained subdued due to cautious sentiment. The release of the Q1 2025 FGN bond issuance calendar added to the market’s caution. This calendar includes three offerings: a re-opening of the bond maturing on April 17, 2029, a re-opening of the bond maturing on February 21, 2031, and a newly issued bond maturing in January 2035 By week’s end, bearish sentiments prevailed, and the average mid-yield across the curve rose by 39bps w/w to 20.09%.

Outlook: The FGN Bonds market is expected to continue trading cautiously as participants adopt mixed positions ahead of the auction.

Eurobonds

The Eurobond market experienced a volatile week, initially facing a bearish trend as prices in SSA and North African regions plummeted due to reduced expectations for Fed rate cuts following a strong jobs report. A rebound was observed mid-week, driven by bullish sentiments across African sovereigns, spurred by discussions within the U.S. economic team and softer inflation data. Despite this, caution returned with notable sell-offs as participants realized gains. By week’s end, mixed to bearish trends prevailed, with the average mid-yield for Nigerian Eurobonds declining by 7bps w/w to 9.36%.

Outlook: We expect that mixed sentiments will persist next week unless any unexpected events occur.

Nigerian Equities

Bearish sentiments dominated the local bourse this week, driven by selloffs in DANGCEM, ARADEL, TRANSCORP, and MTNN, despite bargain hunting in OANDO and DANGSUGAR. The All-Share Index dropped 294bps w/w, closing at 102,353.68 points, while market capitalization settled at ₦62.85 trillion. DANGCEM resumed trading after limit-down closes, with FPIs selling heavily in GTCO and NB. NASCON experienced a rally, which briefly extended to DANGSUGAR and MTNN, but profit-taking ensued. Major off-market trades included over 15 million units of BUAFOODS. Stanbic Holdings’ rights issue is ongoing, with ACCESSCORP listing additional shares from its recent rights issue.

Outlook: We expect the market to trade mixed sentiments next week.

Foreign Exchange

The Nigerian Foreign Exchange Market (NFEM) remained stable throughout the week, with moderate to improved liquidity. Transactions ranged between $/₦1,543.00 and $/₦1,570.00. By week’s end, enhanced dollar liquidity led to a tighter range of $/₦1,540.20 to $/₦1,552.00. Despite these fluctuations, the Naira depreciated slightly, closing at $/₦1,546.72, reflecting a week-on-week decline of 30.5 bps.

Outlook: We expect the Naira to continue trading within a similar range.

Commodities

Oil prices experienced a minor decline but achieved a fourth consecutive week of increases, as the latest U.S. sanctions on Russian energy trade raised concerns about potential oil supply disruptions. Brent crude increased to approximately $80.79 per barrel, while West Texas Intermediate (WTI) was trading at roughly $77.88. Additionally, gold prices faced downward pressure due to a rise in the U.S. dollar on Friday; however, they remained poised for a weekly gain as uncertainties surrounding incoming President Donald Trump’s policies and renewed speculation regarding further rate cuts pushed bullion above the important $2,700 mark. Gold was valued at about $2,701.03 per ounce.

Outlook: We expect the volatility to persist.