Elevated Yields – Investors Increase Bets in Nigeria OMO Bills
Fixed-income investors bolstered demand for Nigerian Treasury and OMO bills in the secondary market amid elevated yields on naira assets.
OMO is gaining attention from yield-seeking retail investors who had been locked out of direct participation over the long term. However, funds have been finding their way into the OMO bills space – with both access granted and yields juicy.
Disinflation continues to strengthen the return on investment in the local debt capital market, though authorities have begun scaling back the juicy offer.
Activity was limited in the Treasury bills space, with only a few trades recorded on the 12 August 2027 NTB, which traded at an average rate of 16.75%.
However, investment firms said buying interest was particularly evident in the shorter- to medium-dated maturities. In a note to investors, Herwood Securities Limited said Nigerian OMO bills maturing on 5 January 2027 were offered at 18.75%.
The OMO bills with a 26 January 2027 expiration date traded around 18.80% bid to 18.70% offer, with most trades executed at approximately 18.75%, reflecting continued demand at prevailing yield levels.
MarketForces Africa reported that the Central Bank sold OMO bills at the belly of the curve at a spot rate below 20%, a level that contrasted with past auctions.
Analysts at Herwood Securities Limited said the session reflected stronger demand for OMO securities, while activity in NTBs remained subdued ahead of the upcoming auction.
Huge Funds Chase Nigerian OMO Bills in Search for 21% True Yield
