FRI JUNE 26 2026-theGBJournal| Nigeria’s fixed-income market remained under pressure as investors continued to offload Treasury bills and selected government bonds, pushing yields higher across most maturities despite relatively stable system liquidity conditions.
The overnight lending rate rose by 6 basis points to 22.2%, reflecting the absence of significant liquidity injections into the banking system.
While funding conditions remained largely balanced, the lack of substantial inflows limited the availability of excess cash and kept short-term borrowing costs elevated.
In the Treasury bills secondary market, bearish sentiment intensified as the average yield climbed 27 basis points to 18.6%.
The selloff was broad-based across the yield curve, underscoring investors’ preference for higher returns amid expectations of sustained tight monetary conditions and attractive primary market rates.
The short end of the curve recorded a 9-basis-point increase in average yield, driven primarily by selling pressure on the 84-day-to-maturity bill, whose yield rose by 41 basis points.
The mid-segment witnessed the sharpest repricing, with average yields advancing 28 basis points following significant profit-taking on the 175-day instrument, which expanded by 87 basis points.
At the long end, yields increased 36 basis points, led by the 315-day bill, where yields surged 79 basis points as investors reduced holdings.
The bearish trend extended to the Central Bank of Nigeria’s Open Market Operations (OMO) segment, where the average yield rose by 16 basis points to 21.5%, highlighting persistent demand for higher risk-adjusted returns across money market instruments.
Meanwhile, activity in the Federal Government of Nigeria bond (FGN) market also reflected cautious investor sentiment.
The average benchmark bond yield advanced by 4 basis points to 16.9% as market participants engaged in selective profit-taking following recent gains.
Across the benchmark curve, yields at the short end increased by 13 basis points, driven by selling pressure on the August 2030 bond, whose yield jumped 65 basis points.
The mid-segment rose 4 basis points as investors trimmed positions in the June 2033 bond, resulting in a 20-basis-point yield increase.
However, the long end of the curve bucked the broader trend. Average yields declined by 3 basis points, supported by renewed demand for the June 2038 bond, which saw its yield contract by 17 basis points.
The buying interest suggests that some investors continue to extend duration in search of yield-locking opportunities, even as broader market sentiment remains cautious.
The latest market movements point to a continued repricing of fixed-income assets as investors weigh elevated interest rates, inflation risks and expectations surrounding future monetary policy decisions, with yields remaining near multi-year highs across key sovereign debt instruments.
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