FMDQ Securities Exchange recorded a turnover of N50.32 trillion in the Fixed Income and Currency (FIC) market in the first quarter (Q1) of 2021.
A breakdown of the performance showed steady monthly growth, rising from N13.03 trillion in January, N17.74 trillion in February, and to N19.55 trillion in March.
A review of the transactions in the month of March indicated that the Foreign Exchange (FX) and Open market operations (OMO) bills transactions were the highest contributors to the FIC markets, jointly accounting for 56.52 percent of the total FIC markets turnover.
The total FX market turnover in March was $12.35 billion, representing a month-on-month (MoM) increase of 16.51 percent from the turnover recorded in the previous month.
FX Derivatives turnover increased by 28.01 percent to $1.84 billion, offsetting the 2.23 percent ($0.09 billion) decrease in FX Spot turnover, and accounting for the total increase in FX market turnover.
According to the exchange, the increase in FX Derivatives turnover was jointly driven by the increase of 71.48 percent ($2.31 billion) and 14.8 percent ($0.12 billion)in FX Swaps and FX Futures turnover respectively, offsetting the 4.72 percent ($0.05 billion) and 20.9 percent ($0.36 billion) decrease in FX Forwards and Other Derivatives turnover respectively.
Turnover for OMO bills decreased by 8.84 to N5.98 trillion, contributing to the decrease in its trading intensity to 1.93 in March 2021 from 1.97 recorded in February 2021.
Similarly, FGN bonds turnover decreased by 30.19 percent to N1.48 trillion, resulting in a decrease in its trading intensity to 0.13 in March 2021 from 0.19 recorded in the previous month.
However, T.bills’ and CBN Special bills turnover increased by 80.21 percent and 363.33 percent to N1.73 trillion and N1.39 trillion respectively in March 2021. The increase in T.bills turnover resulted in the increase in its trading intensity to 0.67 in March 2021
In the secondary market, turnover for OMO bills decreased by 8.84 percent to N5.98 trillion, contributing to the decrease in its trading intensity to 1.93 in March 2021 from 1.97 recorded in February 2021. Similarly, FGN bonds turnover decreased by 30.19 percent to N1.48 trillion, resulting in a decrease in its trading intensity to 0.13 in March 2021 from 0.19 recorded in the previous month. However, T.bills’ and CBN Special bills turnover increased by 80.21 percent and 363.33 percent to N1.73 trillion and N1.39 trillion respectively in March 2021. The increase in T.bills turnover resulted in an increase in its trading intensity to 0.67 in March 2021.
Further analysis of the transactions showed that six months to 12 months OMO bills and T.bills were the most traded debt and short-term sovereign debt securities respectively, accounting for 64.65 percent of the total Fixed Income market turnover, while 20 FGN Bonds remained the most active long-term sovereign debt securities, accounting for 4.35 percent of the total Fixed Income market turnover.
