FGN Bond Yields Fall for Most Maturities Tracked amid Sustained Buy Pressure…


In the just concluded week, Debt Management Office (DMO) allotted bonds worth N150 billion, viz: 12.75% FGN APR 2023 (5-Yr Re-opening) worth N1.50 billion, 13.53% FGN MAR 2025 (7-Yr Re-opening) worth N12.25 billion and 13.98% FGN FEB 2028 (10-Yr Re-opening) worth N136.25 billion respectively.

The 5-year, 7-year and 10-year bonds were auctioned at lower stop rates of 14.52% (from 15.20%), 14.80% (from 15.25%) and 14.94% (from 15.30%) respectively.

Amid lower primary market stop rates, the value of FGN bonds traded at the over-the-counter (OTC) segment rose for most maturities tracked: the 5-year, 14.50% FGN JUL 2021 paper and the 7-year, 13.53% FGN MAR 2025 note appreciated by N0.01 and N0.12; their corresponding yields fell to 15.15% (from 15.16%) and 14.65% (from 14.68%) respectively; however, 10-year, 16.29% FGN MAR 2027 debt depreciated by N0.29 and its yield rose to 14.73% (from 14.67%).

Elsewhere, the value of the FGN Eurobonds traded at the international capital market appreciated for all maturities tracked amid sustained buy pressure – the 10-year, 6.75% JAN 28, 2021 paper and 20-year, 7.69% FEB 23, 2038 note rose by USD2.22 and USD4.33; their corresponding yields moderated to 5.17% (from 5.17%) and 5.40% (from 5.40%) respectively.
In the new week, we expect FGN bond prices to increase (with corresponding fall in yields) at the OTC market amid expected ease in financial system liquidity.

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