Bondholders Maintain Hold on Naira Assets, Yield Steady
The Nigerian government bondholders maintained hold on the naira assets, keeping the benchmark yield steadied. The average yield remained unchanged at 15.73% as the market shifted to a cautious mood.
This suggests continued confidence among domestic investors and a stable appetite for naira-denominated sovereign debt. Bonds maturing in March 2028 and November 2028 saw the largest yield declines, dropping by 3 and 1 basis points, respectively.
Conversely, the bonds maturing in May 2033 and June 2033 experienced the most significant yield increases, rising by 5 basis points and 3 basis points.
Yields steady as Bondholders adopted a cautious approach due to the lingering effects of recent primary market dynamics and abundant system liquidity.
Traders reported that trading activity remained subdued across the curve, though some selective repricing occurred. In a note from AIICO Capital, it was highlighted that short-term bonds exhibited mixed movements.
The investment firm hinted that the bond maturing on March 20, 2027, was quoted sharply lower, while the yield on the bond maturing on February 23, 2028, edged up by 1 basis point to 16.18%.
The yield for the March 20, 2028, local bond eased by 3 basis points to 15.86%.
Mid-term bonds displayed modest upward pressure, with the yield on the May 15, 2033 bond rising by 5 basis points to 16.14% and the April 27, 2032 bond increasing by 1 basis point to 16.07%.
Meanwhile, shorter maturities, such as the February 21, 2031 and April 17, 2029 bonds, saw yields dip by 1 basis point each. Moreover, AIICO Capital Limited reported that long-term bonds remained largely stable, with no changes in the segment from 2034 to 2053, indicating limited demand at current levels.
