MON JUNE 22 2026-theGBJournal| Nigeria’s Debt Management Office (DMO) raised N1.22 trillion Monday, at latest Federal Government bond auction (FGN Bonds) after reopening the January 2035 and April 2037 securities, with investors demanding sharply higher yields amid elevated inflation and tight monetary conditions.
Total subscriptions reached N1.41 trillion, translating to a bid-to-offer ratio of 1.2 times, while the DMO slightly exceeded its N1.20 trillion offer size by allotting N1.22 trillion.
The auction underscored persistent appetite for sovereign debt despite a significant repricing across the curve, with benchmark long-dated yields climbing above 18% for the first time in months.
The DMO reopened the JAN-2035 and APR-2037 bonds, both of which were on-the-run issues at the previous auction.
Investor demand remained concentrated in the two maturities, allowing the government to fully clear the offering and marginally increase allocations above the initial target.
However, the cost of borrowing rose sharply.
The stop rate on the JAN-2035 bond jumped 134 basis points to 18.34%, while the APR-2037 issue cleared at 18.35%, up 131 basis points from the previous auction.
Analysts tells theG&BJournal that the steep increase reflects investors’ demand for higher compensation amid elevated inflation expectations, a restrictive monetary stance by the Central Bank of Nigeria, and expectations that yields will remain high in the near term.
The outcome highlights the balancing act facing Nigerian authorities as they seek to fund widening fiscal needs while contending with rising debt-service costs.
Despite the higher borrowing costs, the auction results point to sustained liquidity in the domestic fixed-income market and continued confidence among institutional investors, including pension fund administrators and banks, which remain attracted by increasingly attractive real returns on long-term government securities.
The repricing of long-dated bonds also signals that the market expects interest rates to remain elevated for longer, with investors demanding higher yields to absorb duration risk amid lingering inflationary pressures and uncertainty over the trajectory of monetary policy.
The successful auction nevertheless provides the government with substantial funding ahead of upcoming maturities and reinforces the depth of demand in Nigeria’s domestic debt market.
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