Yields on Nigerian bond seen flat next week

Nigeria's bond market is expected to be moderately flat next week due to tight liquidity and persistent uncertainty on government policy direction.
Yields have risen around 30 percentage points across all tenors week-on-week after some commercial lenders sold-off part of their holdings to raise funds to meet immediate obligations.
Nigeria's central bank directed commercial lenders earlier this month to pay for their dollar purchases 48 hours in advance in a move aimed at curbing foreign exchange demand, a measure introduced to support the naira.

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"We expect the market to remain quiet in the week ahead because of the impact of various measures introduced by the central bank to support the naira," one dealer said.
Traders said investors were also preferring short-dated instruments because of the lack of policy direction from government and as well as falling global oil prices.
A new cabinet is yet to be formed in Nigeria almost three months after President Muhammadu Buhari took office, raising concern among investors. Buhari has said he needs time to root out corruption before naming his ministers.
"Many people are cautious in taking positions in the market for now, they are rather watching the trend in the economy and this has led to a slow down in the activity at the market," another dealer said.
Yields on the longest tenor 2034 debt rose 32 percentage points to 15.50 percent on Friday from 5.22 percent last week.
The benchmark 2024 paper rose by about 31 percentage points to 15.45 percent against 15.14 percent, while the 2022 debt was trading higher at 15.50 percent, compared with 15.22 percent.