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FMDQ Exchange: Secondary market turnover up 70.20% month-on-month

FMDQ Exchange: Secondary market turnover up 70.20% month-on-month

The secondary market turnover on FMDQ Exchange in December 2023 was N35.81trillion, representing a month-on-month (MoM) and year-on-year (YoY) increase of 28.49percent (N7.94trillion) and 70.20percent (N14.77trillion) from November 2023 and December 2022 figures, respectively.

According to recently released FMDQ Exchange financial markets monthly report for December 2023, the Foreign Exchange (FX), CBN Bills and Money Market (MM) transactions dominated secondary market activity, accounting for 73.29percent of the total secondary market turnover in December 2023.

The report noted that total spot market turnover for all products traded in the secondary market in December 2023 was N30.04trillion, representing a MoM increase of 20.69percent (N5.15trillion) from November 2023 figures. The MoM increase in total spot market turnover was jointly driven by an increase in turnover across all spot market product categories, with contributions by FX, MM and Fixed Income (FI) transactions increasing MoM by 51.27percent (N2.22trillion), 22.95percent (N1.34trillion) and 10.73percent (N1.58trillion), respectively.

The increase in MM turnover was solely driven by an uptick in Repos/Buy-backs, offsetting the MoM decline in Unsecured Placement/Takings transactions. Similarly, the uptick in FI turnover was jointly driven by a MoM increase across all FI products excluding T.Bills and CBN Special Bills which declined in the review period.

Spot FX market turnover in December 2023 was $7.34billion (N6.55trillion), representing a MoM increase of 41.97percent ($2.17billion) from the turnover recorded in November 2023 ($5.17billion).

In the FX Market, the US Dollar appreciated against the Naira, with the spot exchange rate ($/N) increasing by 7.77percent ($/N64.73) to close at an average of $/N897.30 in December 2023 from $/N832.57 recorded in November 2023. Further, exchange rate volatility increased in December 2023 as the Naira traded within an exchange rate range of $/N806.73 – $/N1,099.05 compared to $/N750.14 – $/N996.75 recorded in November 2023.

FI market turnover in December 2023 was N16.31trillion, representing a MoM increase of 10.73percent (N1.58trillion) from the turnover recorded in November 2023 (N14.73trillion). The MoM

increase in the FI market turnover was driven by the 62.74percent (N1.65trillion), 166.67percent (N0.05trillion) and 17.41percent (N0.35trillion) increase in turnover across FGN Bonds, Other Bonds and OMO Bills, offsetting the 0.57percent (N0.03trillion) and 8.92percent (N0.43trillion) MoM decline in T.Bills and CBN Special Bills, respectively.