A total of 110 billion naira worth of bonds were sold at an auction this week at rates higher than at its previous bond auction, the Debt Managment Office (DMO) has said.
The bond auction, being the first days after Central Bank of Nigeria (CBN) call-off its Monetary Policy Committee (MPCC) meeting to set interest rates due to a lack of quorum.
According to the debt office, 45.12 billion naira worth in 5-year debt was sold at 13.38 percent, while 64.88 billion naira of 10-year bonds auctioned at 13.49 percent, higher than 13.19 percent and 13.21 percent respectively it fetched at the last auction.
The total subscription at the sale was 150 billion naira.
The central bank said on Monday it would not hold a meeting to fix interest rates due to its inability to form a quorum and maintained benchmark rates at 14 percent, a level it has kept them at for over a year.
Traders said investors bought bonds at higher yields at the auction to hedge against a possible rate cut later in the year, as inflation continues to decline, fuelling speculation about the outlook for official interest rates.
Investors bid as high as 14.50 percent for the notes. However, the government has been offering debt at lower yields to track declining inflation, which fell for the eleventh month in December to 15.37 percent.
According to the debt office, 45.12 billion naira worth in 5-year debt was sold at 13.38 percent, while 64.88 billion naira of 10-year bonds auctioned at 13.49 percent, higher than 13.19 percent and 13.21 percent respectively it fetched at the last auction.
The total subscription at the sale was 150 billion naira.
The central bank said on Monday it would not hold a meeting to fix interest rates due to its inability to form a quorum and maintained benchmark rates at 14 percent, a level it has kept them at for over a year.
Traders said investors bought bonds at higher yields at the auction to hedge against a possible rate cut later in the year, as inflation continues to decline, fuelling speculation about the outlook for official interest rates.
Investors bid as high as 14.50 percent for the notes. However, the government has been offering debt at lower yields to track declining inflation, which fell for the eleventh month in December to 15.37 percent.
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