Nigeria’s Bond Yields Benchmark Up, Eurobond Slips
Federal Government of Nigeria (FGN) bond yields benchmark advanced as investors sold off portions of their portfolio holdings.
Following the selloffs, the average yield on the secondary market expanded to 13.72%. The 10-year bonds were 145 basis points cheaper, while their corresponding yield rose to 13.50% (from 13.00%), according to Cowry Asset Management Limited.
With the mixed trading pattern spotted, fixed income analysts told investors that 15-year, 20-year, and 30-year FGN Bonds yields remained steady at 14.75%, 15.40%, and 15.65%, respectively.
The market was largely dominated by the bears, analysts at TrustBanc noted that market players exit at the near end to cover short-term obligations.
The investment firm analysts said they noticed a sharp rise in yields of Jan-26 bonds which gained 59bps following the selloffs and Mar-27 FGN bond rose popped higher by 50 basis points.
“…we also saw paltry bids for Apr-49 and Mar-25 securities”, TrustBanc Capital added. The FGN Eurobond traded lower for most of the maturities tracked amid sustained bearish sentiment.
The bulls returned to the Eurobond market, with a bucket of bids for the Jul-23 (-36bps) maturity to halt the reign of profit takers. Thus, the average secondary market yield decreased to 12.78%.
At the weekend, MarketForces Africa reported that the average benchmark yield climbed by 14 basis points week on week to close at 12.48%. Then, the 10-year US treasury yield depleted all week from 3.48% recorded last Friday to 3.3%.
Last week, foreign portfolio investors (FPIs) exited mostly at the near end – Jul-23 (+109bps), while Jan-49 (+24bps) and Nov-47 (+14bps) saw sizeable offers throughout the week.
Then, the average yield on the benchmark Eurobond slid by 2 basis points to 12.78%, according to analysts, and traders’ notes.
The US consumer price index (CPI) data released today signals a cooling economy, as the broad-based inflation slowed to 5%. Elsewhere, the 10-year US Treasury yield advanced to 3.43%. #Nigeria’s Bond Yields Benchmark Up, Eurobond Slips
