Nigeria's fixed income secondary market saw a dramatic spike in trading activity during the week ended June 19, 2026, as investors rushed to reposition portfolios amid a sharp rise in yields across both Treasury bills and FGN bonds.
Data from the Financial Markets Dealers Association (FMDA) showed that Treasury bill turnover surged 137.49% to N1.51 trillion, while FGN bond trading volume rose 75.91% to N1.20 trillion, bringing combined secondary market turnover to approximately N2.71 trillion for the week.
The surge in activity reflected a repricing cycle driven by persistent inflation concerns and domestic liquidity conditions, even as major global bond markets recorded yield declines over the same period.
Treasury bill yields recorded the steepest increases. The average yield climbed 72 basis points to 18.31%, with the 9-month bill posting the largest jump of 154 basis points to 20.15%. The 6-month bill gained 98 basis points to 18.78%. According to the FMDA, weaker demand and investors' preference for higher returns drove the broad increase, consistent with the June 17 NTB primary auction where the CBN raised N1.49 trillion at stop rates that increased by as much as 99 basis points on the 364-day bill.
FGN bond yields rose more modestly, with the average yield edging up 2 basis points to 16.95%. The 7-year and 30-year maturities recorded the largest increases of 24 basis points each, while the 5-year bond was the only tenor to decline, easing by 1 basis point to 17.39%.
The data points to active portfolio repositioning by institutional investors including banks, pension funds, and asset managers, who increased trading activity while demanding higher returns. The relatively modest increase in bond yields compared to the sharper Treasury bill repricing suggested that longer-term investors remained cautious in adjusting their duration exposure rather than aggressively selling longer-dated securities.
Nigeria's fixed income market continued to diverge from global trends. The country's benchmark 10-year bond yield rose 17 basis points to 17.61%, while the US 10-year yield fell 5 basis points to 4.46%. The UK 10-year yield declined 12 basis points to 4.79%, Japan dropped 6 basis points to 2.62%, South Africa fell 21 basis points to 8.41%, and Kenya declined 6 basis points to 12.14%. China's 10-year yield remained unchanged at 1.75%.
Nigeria's 10-year bond now offers a yield premium of 13.15 percentage points over the US equivalent, underscoring the impact of domestic inflation, which stood at 15.93% in May 2026, and local liquidity conditions on domestic fixed income pricing. The divergence highlights how domestic macroeconomic conditions continue to shape Nigeria's fixed income market independently of broader global monetary trends.
