By theG&BJournal
WED FEB 25 2026-theGBJournal| Treasury yields declined across the curve following interest rate cut by the Central Bank of Nigeria (CBN) on Tuesday, triggering a renewed rally in the fixed income market.
Investors reacted swiftly to the policy shift, ramping up demand for government securities as expectations of lower borrowing costs filtered through the system.
The easing stance signaled a potential pivot toward supporting growth amid moderating inflationary pressures and improving liquidity conditions.
As a result, yields on Treasury bills and FGN bonds compressed, with strong bids recorded in both the primary and secondary markets as fund managers repositioned portfolios.
The NTB secondary market traded on a bullish note, as the average yield contracted by 37bps to 17.0%.
Across the curve, the average yield contracted at the short (-13bps), mid (-33bps) and long (-53bps) segments, driven by the buying interests on the 23DTM (-40bps), 177DTM (-60bps) and 268DTM (-125bps) bills, respectively.
Similarly, the average yield contracted by 25bps to 20.4% in the OMO segment.
Elsewhere, the FGN bond secondary market traded on a bullish note, as the average yield contracted by 26bps to 15.7%.
Across the benchmark curve, the average yield contracted at the short (-54bps) and mid (-35bps) segments, driven by the demand for the FEB-2031 (-135bps) and APR-2032 (-74bps) bonds, respectively, but closed flat at the long end.
The overnight lending rate contracted by 43bps to 22.3%, following inflows from OMO maturities (N730.70 billion).
Analysts say the rate cut could sustain momentum in the bond market in the near term, particularly if liquidity remains supportive and inflation trends continue to soften. Attention now turns to how the naira and broader financial markets will respond to the new monetary environment.
Meanwhile, the overnight lending rate contracted by 43bps to 22.3%, following inflows from OMO maturities (N730.70 billion).
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