Secondary market turnover rose 37%, to N63trn on FMDQ Exchange in August

Bamidele Famoofo

The FMDQ Exchange witnessed a significant surge in secondary market turnover, reaching N63.90 trillion in August 2025. This represents a 36.94 per cent increase from the previous month, with an additional N17.24 trillion injected into the market. On a year-on-year basis, the growth trend rose by N23.47 trillion, or 58.06 per cent, indicating sustained investor interest.

Foreign Exchange (FX) and Money Market transactions dominated the secondary market activity, accounting for 69.21 per cent of the total turnover. The spot market turnover for all products reached N60.99 trillion, a 36.68 per cent month-on-month increase (N16.37trn)from July 2025 figures (N44.62trn).

The MoM growth was driven by higher turnover across FX, FI and MM products, which rose by 6.35 per cent (N1.24trn), 39.58 per cent (N5.58trn) and 86.90 per cent (N9.55trn), respectively.

The surge in MM turnover was primarily driven by heightened Repos/Buy-back activity. Similarly, the increase in FI turnover reflected stronger activity across most sub-product categories, excluding FGN Bonds, while CBN Special Bills remained inactive during the review period.

Spot FX market turnover recorded on FMDQ Exchange was $13.54bn (N20.77trn) in August 2025, representing a 6.11 per cent ($0.78bn) MoM increase from the turnover recorded in July 2025 ($12.76bn).

In the FX Market, the Naira depreciated against the US Dollar, with the spot exchange rate ($/N) declining by 0.23 per cent ($/N3.49) to close at an average of $/N1,535.18 in August 2025 from $/N1,531.59 recorded in July 2025.

Further, exchange rate volatility decreased in August 2025, with the Naira trading within an exchange rate range of $/N1,530.00 – $/N1,538.45 compared to $/N 1,520.00 – $/N1,537.00 recorded in July 2025.

T-bills and FGN Bonds with TTMs of >6M–12M and >5Y–10Y, respectively, were the most actively traded sovereign fixed income securities, accounting for 30.91 per cent (N1.59trn) and 41.67 per cent (N2.14trn) of secondary market turnover.

The sovereign yield curve spread narrowed by 0.33pts MoM to -1.62ppts in August 2025, indicating a deeper inversion of the yield curve. During the same period, Nigeria’s one-year (1Y) real
(inflation-adjusted) yields remained negative at -0.92 per cent, lagging those of selected emerging markets.

Total turnover in the money market segment increased MoM by 86.90 per cent (N9.55trn) to N20.54trn in August 2025. The MoM increase was driven by the 87.15 per cent (N9.56trn) increase in Repos/Buy-backs.
The average O/N rate and OPR rate (secured lending rate) decreased MoM by 0.89ppts and 0.83ppts, respectively, to close at an average of 28.54 per cent and 28.12 per cent in August 2025.

Total turnover in the FX derivatives segment was $1.90bn (N2.91trn) in August 2025, representing a MoM increase of 42.23 per cent ($0.56bn) from July 2025 figures ($1.33bn).
The MoM increase in the FX derivatives turnover was driven by the 42.18 per cent ($0.56bn) and 48.87 per cent ($0.005bn) increase in FX Swaps and FX Forwards transactions respectively, during the
review period.

In the Cleared Naira-Settled (USD/NGN) Non-Deliverable Forwards (NDF) market, the near month contract (NGUS Aug 27, 2025) expired with no open positions settled during the period. No new far month (60M) contract was introduced in the Cleared USD/NGN NDF market in the review period, continuing the trend since August 2024.

Consequently, the TTM of the farthest open contract is five (5 months (i.e., NGUS JAN 28, 2026 contract).
The cumulative NV of open Cleared USD/NGN NDF contracts remained flat at $0.002bn for the third consecutive month in August 2025, whilst representing a YoY decrease of 98.81 per cent ($0.11bn).

The average modelled rates for the 13M – 24M Naira-Settled Exchange-Traded FX Futures contracts declined (depreciated) MoM, while 25M – 33M contracts recorded an increase (appreciated) MoM, reflecting a mixed movement across the curve between July and August 2025.