The average yield on Federal Government of Nigeria (FGN) bonds in the secondary market rose slightly ahead of the Central Bank’s monetary policy committee (MPC) decision. Trading was subdued as investors held back, awaiting the MPC outcome.
Yields increased across the curve, rising by 7 basis points at the short end, 2 basis points in the mid-segment, and 2 basis points at the long end. This pushed the average FGN bond yield up by 4 basis points to 19.06%, driven by light sell-offs mostly in the short and belly segments.
Last week, the bond market was cautious following the announcement of a ₦300 billion, 7-year Sukuk at a 19.75% coupon. However, midweek sentiment improved with strong demand for longer-dated bonds like the FGN 2034, 2032, and 2049, which saw yields decline.
Investor confidence was also supported by April’s inflation easing to 23.71% from 24.23% in March, which boosted interest in the FGN 2033 bond later in the week. Consequently, the average benchmark yield dropped 5 basis points week-on-week to 18.81%.
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