Benchmark Yield On Nigerian Bonds Rises 10bps
Benchmark Yield on Nigerian Bonds Rises 10bps
The benchmark yield on Nigerian government bonds increased by 10 basis points week on week in the secondary market, reflecting investors’ risk-off sentiment in the debt instruments.
A slew of analysts maintained that the yield on debt papers will continue to trail other short-term investment instruments as the Debt Office continues to reduce its borrowing costs.
Despite their similarities, bond yields are below those of short-term investment securities, including Nigerian Treasury and OMO bills, in the fixed-income market.
Asset managers and institutional investors with an interest in long-term investment bets continue to be locked in yields in long-duration naira assets.
Broadstreet analysts reported that Nigeria’s bond market closed in the negative zone, with average yields increasing by 10bps to 15.89% week on week, from 15.79%.
The yield contraction was driven by strong sell pressure in the short end of the curve, particularly in the Mar-27s (+157bps and +155bps), Feb-31 (+13bps ), and Apr-32 (+17bps).
However, buying interest still surfaced in select tickers across the curve, concentrated in the mid-to-long end, with the May-33 (-22bps), Jun-33 (-20bps), and Jan-42 (-9bps) papers recording yield declines. Nigerian Treasury Bills Yield Rises to 17.3% after Auction
