Nigerian Bond Trading on Hold Ahead of Inflation Data
The average yield on Nigerian government bond was steadied in the secondary market due to subdued trading activities. The benchmark yield ended the trading session flat at 19.41% ahead of the inflation data release.
Bondholders in the fixed-interest securities market have been taking cautious positions with a bearish sentiment on expectation that the consumer price index would race higher. The quiet trading activities in the bond market came on the back of the Debt Management Office plan to reopen the 2029 and 2031 papers, offering ₦60 billion each.
Also, fixed income analysts said a possible interest rate hike at the next monetary policy committee meeting has spurred portfolio rebalancing. Traders have noted that pockets of demand have persisted in longer-term securities, driven by investors’ strategic focus on locking in yields before further rate hikes.
“If inflation rate accelerated in October, it is likely to see extended monetary policy tightening in Nigeria’, analysts said at MarketForces Africa online forum. Analysts at TrustBanc told investors in a note that the 2029 FGN bond drew attention, closing at an offered rate of 20.50%, a slight uptick of 5 bps from the previous day’s 20.45%.
Despite this selective profit-taking, the overall market held steady, with the average benchmark yield closing flat. Analysts said they expect the quiet trading session to persist as investors prepare for the potential implications of the new inflation figures on interest rates. #Nigerian Bond Trading on Hold Ahead of Inflation DataFG Earmarks N47.5bn for Upgrade of 50 Selected Schools
