DMO Crashes Rates on Nigerian Government Bonds
The Debt Management Office (DMO) crashed spot rates on Nigerian government bonds at the main auction for the month of July amidst tight supply and surging demand.
MarketForces Africa reported that the office opened its monthly bonds auction for subscription, where it sought to raise N80 billion across 5- and 7 years reopenings. As planned, the authority offer size the bonds across two tenors, and yield-hunting investors doubled down on their bets on the naira assets at the auction.
Auction results obtained by MarketForces Africa showed that aggregate subscription from the competitive bids came stronger. Investors staked N300.67 billion in bets against the limited offer.
Eventually, the DMO raised N185.93 billion across the two tenors offered at its primary market and rejected the remaining balance from the aggregate subscriptions.
The stop rate on Nigerian government bonds maturing in April 2029 fell sharply to 15.69%, which is 206 basis points below previous auction sales. Also, the spot rate on Nigerian government bonds maturing in June 2032 fell by 205 basis points to 15.90%, details from the auction results reviewed showed.
Reflecting appetite, preference for long duration, Nigerian government bonds maturing in June 2032 experienced significant demand, accounting for 93% of the total allotment.
In the secondary market, trading activity opened on a calm note with a bullish undertone, as investor focus shifted to the day’s FGN bond auction. #DMO Crashes Rates on Nigerian Government Bonds Nigerians in Diaspora Remit $20.92bn Home in 2024 – Tinubu
