Nigeria’s 10-Year Bond Attracts 21.50% Interest Rate

Nigeria’s 10-Year Bond Attracts 21.50% Interest Rate

Nigeria’s 10-year bond was sold to asset managers, and other investors in the local debt capital market at spot rate of 21.50% at the latest primary market auction conducted by the debt management office, DMO.

According to details from the auction results, DMO offered investors that subscribed to Federal Government of Nigeria (FGN) 10-year bonds 21.50% for parting with their fund amidst growing inflation rate.

This represent an uptick from the previous auction sold at average rate of 20%. Yields across fixed interest securities tenors have remained elevated. However, real return on investment has been depressed due to negative interest yield.

Meanwhile, the local FGN bonds market was quiet as participants shifted their attention to bond auction in the primary market. Consequently, the average yield flattened at 18.61%.

At the auction, DMO offered ₦450.00 billion across the 2029, 2031 and 2033 FGN Bond papers. According to traders, subscription level or demand was relatively strong, with bid-to-offer and bid-to-cover both closing positive at 1.62x and 1.10x, respectively.

Spot rate son APR-2029 FGN Bonds closed at 19.64%. DMO offers 201.9% on FEB-2023 FGN bonds to interested market participants while investors get 21.50% spot rate on 2033 FGN Bonds.  Analysts said they expect trading session in the secondary market to trend bearish, given the uptick in stop rates at the auction.  Nigeria, U.S Firm Sign MoU on Human Space Flight