Nigerian Bonds Trading Softens, Yields Steady
In the bonds market, trading activity remained muted, with the average yield holding steady at 19.41%. The subdued yield on FGN bonds and tight liquidity in the financial system has keep trading activities in check.
Mostly, investors have shown preference for holding asses to maturity with little fluctuation in sentiments, based on latest trading pattern. Analysts are expecting the bond market to trade on a mixed note ahead of inflation data which is expected to be released in the latter part of the week.
Inflation is projected to rise further, while the market expects higher rates on bond pricing at the primary market auction. Many analysts expressed reservation on spot rates adjustment given the fact that the Debt Office has met significant part of its FGN bonds sales for the year.
The authority bonds supply has also been halved after frontloading of the borrowing instrument earlier in the year. Monthly bonds supply by the debt office has fallen to N180 billion from N360 billion as the year drawing close.
In the secondary market, analysts noted that buying interest was primarily focused on the Feb 2031, May 2033, Feb 2034, and Jun 2053 papers. This has dragged their yield lower across the curve.
On Monday, the average yield expanded at the short (+1bp) end due to the sell-off of the JAN-2026 (+5bps) bond, traders said in a note.
However, yield contracted at the mid (-6bps) segment following buying interest in the FEB-2031 (-17bps) bond. Fixed interest income analysts also noted that the average yield closed flat at the long end.
The market saw some interest in specific maturities to begin the week, particularly with the April 2029, February 2031, February 2034, and June 2053 bonds. However, the number of transactions was limited. #Nigerian Bonds Trading Softens, Yields Steady Ghana to Import Petroleum from Dangote Refinery – Official
