DMO to Auction N1.1 Trillion in Bonds Amid Rising Yields

The Debt Management Office (DMO) of Nigeria is scheduled to open a Federal Government of Nigeria (FGN) bond auction on Monday, offering N1.10 trillion across three reopened securities. The offer includes N250 billion of the 10-year FGN bond maturing in January 2035, N100 billion of the 20-year bond maturing in April 2037, and N750 billion of the 15-year bond maturing in June 2038.

The 15-year bond constitutes 68.2% of the total offer. This auction occurs amid a bearish sentiment in the government bond market, with the average yield on Nigerian government bonds rising by 13 basis points week-on-week to 17.13%.

The previous auction in July saw combined subscriptions of about N1.74 trillion for the same bonds, with an allotment of approximately N929.3 billion at marginal rates of 18.34%, 18.35%, and 18.40%. The current auction's focus on the 15-year bond may indicate investor appetite for long-term government borrowing, as outlined in the DMO’s third-quarter issuance calendar.