Nigerian Bond Yield Climbs to 19.78% Ahead of Fresh Supply
The average yield on Nigerian government bonds surged by 2 basis points to close at 19.78% in the secondary market ahead of fresh supply. Trading activities were subdued last week, with minimal trading activity at the short end (+4 bps) of the curve as markets await further details on Debt Office local borrowings for 2025.
Traders reported that there were selective interest in mid- and long-term maturities. Early sessions focused on the February 2031 and May 2033 papers, later extending to February 2034 and June 2053, according to AIICO Capital Limited.
Fixed income market analysts noted that while demand persisted, executed volumes stayed weak throughout the week. By the end of the week, the activity centred on the belly-to-tail end of the curve, and participants cherry-picked attractive yields. In their separate outlook for the week, investment analysts said they expect bonds to trade sideways as participants await the Q1 2025 FGN bond issuance calendar.
Fixed income market analysts stressed that they observed only retail-sized trades from cautious investors. Across the benchmark curve, the average yield expanded at the short (+14 bps) and mid (+1bp) segments.
The yield surge occurred on the back of sell pressure witnessed on the JAN-2026 (+63bps) and JUL-2034 (+1bp) bonds, respectively. The average yield closed flat at the long end. “We still expect quiet proceedings as we believe investors are likely to align their strategies with evolving macroeconomic conditions and the release of the FGN bond calendar.
“Meanwhile, we also maintain our short-term expectation of elevated yields consequent on anticipated monetary policy administration globally and domestically and sustained imbalance in the demand and supply dynamics,” Cordros Capital Limited told investors in its note. #Nigerian Bond Yield Climbs to 19.78% Ahead of Fresh Supply 2025 Budget: N13trn Deficit to be Financed Through Borrowing – Edun
