The Debt Management Office (DMO) has reported an overwhelming investor interest in its June 2025 bond auction, recording a 603% subscription rate as investors sought to take advantage of cooling inflation and adjusted interest rates.
According to figures released by the DMO, the federal government offered ₦100 billion worth of bonds—comprising ₦50 billion each of the five-year (maturing April 2029) and seven-year (maturing June 2032) tenors. However, the auction received a total bid of ₦602.9 billion, far surpassing the initial offer.
In response to the strong demand, the DMO allotted ₦100 billion but revised the coupon rates downward, offering the five-year bond at 17.75% and the seven-year bond at 17.95%, both lower than previous auction yields. This strategic adjustment reflects the federal government’s aim to manage debt servicing costs amid a more favourable inflation outlook.
The breakdown of the bids shows a significant investor preference for the seven-year instrument, which attracted ₦561.17 billion out of the total bid volume. Consequently, ₦98.95 billion was allotted under that tranche, while the five-year bond drew only ₦41.69 billion in bids, resulting in a marginal allotment of ₦1.05 billion.
Analysts say the high bid volume and rate moderation suggest renewed investor confidence in Nigeria’s macroeconomic direction, particularly as the Central Bank maintains its tightening stance to contain inflationary pressures. They also noted a shift in investor appetite toward longer-tenure securities, as markets appear to favour long-term returns amidst anticipated policy stability.
The DMO noted that the outcome of the auction reaffirms the continued strength and resilience of the domestic debt market. The agency assured the public that it will maintain its strategy of prudent borrowing and active debt management to ensure sustainable financing of national development objectives.
This latest auction underscores Nigeria’s ability to attract robust domestic capital even in the face of economic headwinds, a trend seen as a positive sign for fiscal consolidation efforts under the current administration.
