The US dollar was mixed against its major trading partners — up versus the pound and Canadian dollar, down versus the euro and yen — early Thursday.

The average yield on Nigerian government bonds climbed to 15.74% on Tuesday amidst high inflation rate expectations. The secondary market witnessed selloffs across tenors with investors showing particular interest in very long-dated borrowing instruments.

Following the bearish trades recorded, the average yield increased by 7 basis points (bps) to reach 15.74%. In its market note, Cowry Asset said the increase was primarily driven by yield expansion of 87bps observed in the JUN-53 FGN paper.

Bondholders selling off their holdings saturated the financial system liquidity, dragging short-term benchmark rates downward.

Market data from the FMDQ platform showed that money market rates trended on a mixed note as cash-rich deposit money banks sought higher returns on their free cash,

Reacting to the forces, the open repo rate (OPR) decreased by 0.09% to 16.83%, while the overnight lending rate increased by 0.02% to 17.92%. 

With shifting risk sentiment, the treasury bills space ended with a mild rally in the secondary market.  Traders said the average secondary market yield dropped by 1bp to settle at 13.34% at the close of the trading session.

In Nigeria’s sovereign Eurobonds market, there was a negative level of activity, according to Cowry Asset Limited.

Analysts said sell sentiment was evident across the short, mid, and long ends of the yield curve, leading to an increase in the average yield by 9bps to settle at 11.55% on Tuesday.    Nigeria Eurobond Slumps after CBN Resumes OMO Auction