Nigeria Bond Benchmark Yield Slides to 19.27%
Nigeria’s fixed income market witnessed thin transaction that caused a slight movement around the bond yield curve. In the secondary market, trading activities on Federal Government of Nigeria was relatively cold, and quiet with albeit bullish tilt.
According to investment firms fixed income market updates, there was pocket of transactions following debt management office (DMO) primary market auction sales on Monday.
The authority offered authorised dealers and pension fund administrator 20% spot rate on 10-Year bonds. The auction was oversubscribed by more than two times due to increase demand for government borrowing instruments.
Interest rate upward adjustments made borrowing rate. DMO had frontloaded bond sales to maintain lower spot rates until the market sought yield repricing after policy rate adjustment and untamed inflation conditions.
Fixed interest securities investors investor increased their portfolios with moderate interest in short end (-9bps) of the curve. Hence, average yields declined by 3bps to close at 19.27%. Naira Skids as FX Turnover, External Reserve Decline
In the money market, liquidity pressures increased despite inflows from matured OMO bills. The overnight lending rate expanded by 98bps to 31.4% despite N17 billion inflows from OMO bill.
Fixed income securities asset traders said across the benchmark curve, the average yield inched higher at the short (+1bp) end as investors sold off the MAR-2025 (+2bps) bond but closed flat at the mid and long segments.
