Nigeria’s business activity remained in expansion territory as the IHS Markit-Stanbic IBTC headline PMI remained at 52.9 points in April.
Expansion in new orders and output was suggestive of higher demand requiring higher staffing and inventory purchases. Backlogs also reduced.
Meanwhile, annual inflation (consumer price) rate continued to trek northwards, having risen to 18.17% in the month of March (from 17.33% recorded in February).
Persistent rise in the food prices continue to exert pressure on the annual inflation rate even as the Core Index also climbed higher in the month of March.
Structural challenges, the ongoing planting season and rising insecurity challenges in the food producing areas of the country continued to impact negatively on the food basket.
Net Savers Earn Little as Prime Borrowers
Remain Most Favoured
Meanwhile, despite the aggressive rise in inflation rate, net savers earned little as average savings deposit rate remained less than 2% while 3- and 12-month deposit rates fell to 3.03% and 4.94% (from 3.13% and 5.36% in February) respectively.
In contrast, prime borrowers continued to benefit from a sustained decline in interest rates as average prime lending rate fell for the fourth straight month to 11.13% (from 11.21% in February).
The banks were however compensated by an increase in maximum lending rates to 28.74% (from 28.54%).
Meanwhile, stop rates of auctioned 364-day T-Bill rose for the eighth consecutive month to 9.75% (from 9% in March); however, stop rates for the 91-day and 182-day bills were flat at 2% and 3.50% respectively.
At the secondary market, investors in T-bills remained bearish, driving NITTY higher.
Notably, 12 months and 6 months NITTY rose by 2.33ppt and 0.63ppt to 8.81% and 4.28% respectively in April.
In April, FGN bonds were auctioned at higher stop rates for the 10-year, 15-year and 25-year maturities as investors continued to demand for higher yields.
Stop rates for the 10- year, 15-year and 25-year bonds rose to 12.25% (from 10.50% in March), 13.34% (from 11.50% in March) and 13.85% (from 12.00% in March) respectively