The Debt Management Office (DMO) has confirmed plans to raise ₦100 billion via Federal Government bonds at its upcoming auction scheduled for June 24, 2025. The offer, detailed in a newly released circular, includes ₦50 billion each for a re-tap of 2029 notes and a fresh issue of 2032 bonds.
Investor interest has already intensified in the secondary market, especially for 2033 bonds, following the announcement. Analysts believe the auction will attract strong participation, supported by excess liquidity within the banking system and easing inflationary pressures.
While inflation has moderated slightly, there is division among analysts over whether spot rates will rise or hold steady. Some argue that the soft inflation trend could pave the way for lower rates, while others point to cautious fiscal policies that may limit downward movement in yields.
“For reopened bonds, successful bidders will pay a price aligned with the yield-to-maturity that clears the auction volume, along with any accrued interest,” the DMO explained.
The average yield on sovereign bonds has slipped to 18.5%, raising concerns that lower returns could lead to capital flight by foreign investors. Across the yield curve, short- and mid-tenor instruments held steady, while long-dated bonds recorded slight declines, led by the JUN-2053 note, which dropped 18 basis points.
As Nigeria continues to manage its debt cost and market expectations, all eyes will be on the June auction to gauge appetite for local government securities and the future direction of yields.
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