MON OCT 19 2026-theGBJournal| Yields on Nigeria’s benchmark government bonds rose at Monday’s Federal Government bond (FGN Bond) auction, with investors demanding higher returns on longer-dated securities as the Debt Management Office (DMO) reopened three bonds worth a combined ₦1.75 trillion.
The DMO received bids totalling ₦1.75 trillion, matching the amount offered and resulting in a bid-to-offer ratio of 1.0 times.
It subsequently allotted ₦1.21 trillion, with the bid-to-cover ratio settling at 1.4 times.
The auction results showed upward pressure on borrowing costs for the September 2036 and June 2038 bonds, both of which were the most recently issued securities at the previous auction.
The stop rate on the September 2036 bond rose by 50 basis points to 17.29%, while the rate on the June 2038 bond increased by 34 basis points to 17.19%.
The February 2034 bond settled at a stop rate of 16.99%.
The increases in yields on the longer-dated securities point to higher returns being required by investors to hold the bonds at the latest auction.
Higher yields also translate into increased borrowing costs for the government on newly issued debt.
The DMO’s decision to allot ₦1.21 trillion, below the ₦1.75 trillion on offer, meant that about 69% of the offered amount was allocated, despite bids matching the total supply.
The auction highlights the importance of investor demand and the yields required to attract funding as the Federal Government raises money through domestic debt markets.
Auction summary
-Total offered: ₦1.75 trillion
-Total bids received: ₦1.75 trillion
-Total allotted: ₦1.21 trillion
-Bid-to-offer ratio: 1.0x
-Bid-to-cover ratio: 1.4x
-February 2034 stop rate: 16.99%
-September 2036 stop rate: 17.29%, up 50 basis points
-June 2038 stop rate: 17.19%, up 34 basis points
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