The fixed income market closed the week on a bullish note, with yields across the T-bills, local bonds, and Eurobond segments experiencing a broad-based decline, according to a recent report by Meristem Securities.
In the Treasury bills segment, the secondary market maintained a bullish trajectory, as average yields declined by 5 basis points to 20.84 per cent from 20.90 per cent recorded in the previous week.
The short end of the curve saw the most significant dip, falling by 53 bps, driven by increased demand for the 20-day, 34-day, and 83-day bills. The mid-tenor segment followed closely with a sharper drop of 102bps, largely due to strong interest in the 264-day bill, which dipped 28bps.
Similarly, the long end recorded a 7bps decline, with yields on the 279-day and 356-day maturities dropping by 39bps and 19bps, respectively.
The local bond market also posted a mild bullish performance, with the average yield falling by 4bps to 19.03 per cent from 19.07 per cent. Investor interest was largely concentrated in the short and mid segments of the yield curve.
The short end dipped by 10bps, supported by active buying in the MAR-2026 (-17bps) and JAN-2026 (-6bps) instruments. The mid-segment recorded a more substantial contraction of 43bps, spurred by sustained demand for the JUL-2034 bond, which dropped 27bps.
On the long end, average yields declined by 58bps, driven by strong interest in the APR-2037 and APR-2049 papers, which fell by 20bps and 18bps, respectively.
In the Eurobond market, bullish sentiment persisted for yet another week, with average yields across Nigerian sovereign issues dropping significantly by 60bps to 9.79 per cent from 10.39 per cent last week.
Meristem added that the rally was widespread, affecting all maturities, with notable contractions seen in the MAR-2029 (-75bps), NOV-2027 (-75bps), and SEP-2028 (-67bps) bonds.
The Meristem report attributed the bullish run in the Eurobond segment to improving global macroeconomic sentiment, largely influenced by a temporary resolution in the ongoing trade tensions between the United States and China.
The report indicates that the renewed interest across all segments of the fixed income market was driven by a combination of strong local demand, attractive yields, and improving external conditions.
Analysts expect the bullish momentum to persist in the short term, especially if macroeconomic stability continues to improve and monetary policy remains supportive of investment in fixed-income instruments.
