Nigerian Treasury Bills See FPIs Selloffs, Yield Settles Near 20%
The average yield on Nigerian Treasury bills (NGX) dipped by four basis points amidst mixed trading sentiment in the secondary market at the beginning of the week post 14% U.S. tariffs on Nigeria’s exports.
Foreign portfolio investors (FPIs) led the selling rally in the secondary market amidst rising demand for safer assets and concern the Nigerian government could face revenue pressures following a higher US tariff on exports.
Trading activities in the secondary market ended on a bearish note on Monday as the average yield expanded by 4 basis points (bps) to 19.9%, according to Cordros Capital Limited.
Risk-off sentiment emanating from increased demand for safe haven assets has forced some FPIs to exit from the Nigerian market in recent times. But as offshore investors continue to offload positions, local players sought opportunities at attractive yield levels.
The selloffs led by foreign investors’ overwhelmed limited buy-side interest. While some demand emerged for short-tenor papers, offers were scarce. Trading focused on the Feb 2026 and Mar 2026 maturities. Some buying interests were seen on 22 Jan (-327 bps) and 25 Dec (-179 bps).
Fixed income analysts at the investment banking firm reported that across the curve, the average yield declined at the short (-3 bps) and mid (-3 bps) segments.
The contraction in yield was driven by demand for the 80-day to maturity (-3bps) and 171-day to maturity (-3bps) bills, respectively. Meanwhile, yield expanded 11 basis points at the long end, driven by profit-taking activities on the 318-day to maturity (+155 bps) bill.
Similarly, the average yield contracted by 5 bps to 24.3% in the OMO segment. Fixed income market analysts expressed the view that the bearish tone is likely to continue ahead of this week’s potential NTB auction, with investors also awaiting the Q2 2025 borrowing calendar for direction. First Holdco Falls below N1 Trillion in Equities Market
