The Central Bank’s bimonthly auction last week witnessed a total subscription of N307.3 billion in treasury bills, a sharp drop from N513.43 billion demanded at the previous auction.

Market watchers have attributed the drop to the declining interest of offshore investors in domestic debt holdings. Offshore investors due to high inflation and the depreciating value of local currency choose to sell their local debt holdings and re-invest their funds abroad thus putting further pressure on local currency, market analysts have said.

The apex bank sold a total of N126.3 billion in treasury bills ranging from three months to one year with higher yields on the paper than at the previous auction.

Specifically the treasury bill market witnessed N30.65 billion worth of 91 day bills sold at the rate of 13.50 per cent against 13.19 per cent the previous auction while N45.00 and N50.68 billion worth of 182 day and 364 day bills at the rate of 14.14 per cent and 14.30 per cent respectively compared with the 13.87 per cent and 13.94 per cent at the previous auction.

At the Over-The-Counter (OTC) bond market investment was on the downside with a recorded volume of 100.532 million units valued at N89.61 billion in 672 deals in comparism with a turnover of 131.542 million units of Nigerian Sovereign bonds at the value of N121.239 billion in 935 transactions at the previous auction.

The nation’s interbank lending rate last week plunged to an average of 10.41 per cent against 14.66 per cent in the preceding week. The secured Open Buy Back (OBB) dropped to 10.25 per cent compared with 14 per cent it stood at the preceding week representing 175 basis points lower than Central Bank’s 12 per cent benchmark rate and 0.25 percentage points above the Standing Deposit Facility (SDF) rate.

Also, overnight placement and call money nosedived to 10.50 per cent each as against 15 per cent each of the previous week.

Market watchers say about N278 billion, portion of budgetary allocations for States and local governments entered the market last week.

At the start of business last Friday, the market had a cash balance of N387 billion a sharp comparism with the N32 billion at which it opened last week according to reports.

The equities market of the Nigerian Stock Exchange (NSE), the bears were on top of the game as market capitalisation of listed equities depreciated by N47 billion to close at N7.090 trillion having opened the week at N7.137 trillion.

Also the benchmark index which tracks the value of listed shares the All Share Index (ASI) plunged by 0.66 per cent, to finish at 22,232.36 basis points as against its opening of 22,381.11 basis points.

Three of the NSE Sectorial Indices also tilted Southwards. The NSE 30 index, a barometer for tracking the 30 most capitalised companies on the exchange dropped by 0.28 per cent.

The NSE Consumer Goods Index dipped by 1.75 per cent even as the NSE Oil/Gas Index depreciated by 2.41 per cent.

On the flipside, the NSE Banking Index rose by 0.22 per cent while NSE Insurance Index went up by 0.13 per cent according to the NSE weekly report.

The overall economy, according to the National Bureau of Statistics (NBS) surged by 6.17 per cent compared with 7.68 per cent of the fourth quarter of 2011.

Oil production fell to an average of 2.35 million barrels per day (bpd) in the first quarter as against 2.4 million bpd in the fourth quarter of 2011m the NBS report noted.

Vivian-Peace Nwinaene