FMDQ OTC Exchange Records N15trn Turnover in One Month

The fixed income and currency (FIC) market operated by FMDQ OTC Securities Exchange opened 2019 on a weak note, recording a turnover of N15.08 trillion in January. The performance showed a decrease of 14.8 per cent compared to the turnover of December 2018, which was N17.7 trillion.

The Treasury Bills (Tbills) and Foreign Exchange (FX) market segments remained the major driver s of turnover in the FIC market, jointly accounting for 78.69 per cent of turnover in January and higher by 2.21 percentage points from their contribution to turnover in December (76.48 per cent).

Total FX market turnover in January 2019 was $14.91 billion, representing a 35.36 per cent

Increase from the $11.01 billion turnover recorded in December2018. The increase in FX turnover in January can be attributed to the 150.61 per cent and 0.61 per cent rise in member-clients and inter-member trades which was only marginally offset by the 27.55 per cent decrease in member-CBN trades

Contrastingly, turnover at the Investors & Exporters (I&E) FX Window in January 2019 recorded 22.42 per cent and 26.86 per cent month-onmonth(MoM) and year-on-year decreases respectively to close at $3.84 billion from the $4.95 billion and $5.25 billion recorded in December and January 2018 respectively

Analysis of FX turnover by product type showed that FX Spot was the main driver of the overall increase in FX turnover, with a MoM increase of 462.93 per cent. The exchange said the increase in FX Spot could be attributed to FX inflow for investments in the higher yielding FGN fixed income securities. Conversely, FX Derivatives recorded a MoM decrease of 42.34 per cent , driven mainly by a44.89 per cent decline in member-CBN FX Swaps turnover, while turnover in FX Futures also declined by 35.66 per cent.

Total T. bills(including OMObills) outstanding recorded a MoM decrease of N0.16trn to close at N2.58 trillion as the CBN continued mopping up liquidity via its OMO auctions to curtail build-up of inflationary pressure. FGN Bonds remained flat at N8.26trn as at January 31, 2019.

Monthly Trading Intensity in the T. bills and FGN Bonds markets decreased marginally from 0.49 and 0.09 in December 2018, to 0.46 and 0.08 in January