Local bonds average mid-yield has risen by 23 basic point to 18.84% in the secondary market.
According to AIICO Capital Limited, trading activities were bearish as investors offloaded naira assets in the secondary market.
Last week, the average yield on treasury bill spiked by 10 basis points in the secondary market due to increase in inflation and investors are searching for investment protection option.
Reflecting investors’ apathy, the Debt Management Office’s (DMO) bonds auction was greatly under subscribed over sustained negative interest yield amidst high inflation environment.
At the primary market auction, the DMO offered instruments worth N450.00 billion to investors through re-openings of the 19.30% FGN APR 2029 bond, 18.50% FGN FEB 2031 bond, and 19.89% FGN MAY 2033 bonds.
According to the auction result, 5-Year bond was sold at 19.64%, 35 basis points above previous auction rate. Also, a 7-Year FGN bond was sold at 20.19%, which was 45 basis points above previous auction rate, while 10-year bond attracted 21.50%, 161 basis points above previous auction spot rate.
“The average yield increased at the short (+6bps) and long (+1 bps) ends. The yield surge was a results of selloff activities on the MAR-2025 FGN bond, causing its yield to rise by +13 bps and JUN-2053 by +10bps bps, respectively. According to Cordros Capital Limited.”
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