DMO allots N1.56 trillion FGN bonds as demand hits N1.73 trillion, lowers rates

Nigeria's Debt Management Office (DMO) auctioned N1.56 trillion across three Federal Government of Nigeria (FGN) bonds on August 17, 2026, following an investor demand of N1.73 trillion. The auction, conducted under a non-competitive window, saw well above the offered amount allotted. The bond offerings included the 22.60% FGN January 2035, the 16.2499% FGN April 2037, and the 15.45% FGN June 2038 bonds.

The 15.45% FGN June 2038 bond saw the largest subscription and allocation, indicating strong demand for long-dated government securities. The DMO accepted 226 bids out of 595 submitted, with the original coupon rates maintained at 22.60%, 16.2499%, and 15.45%. The allocation to the 15-year bond, the 15.45% FGN June 2038 bond, accounted for nearly half of the total subscriptions and allotments.

This represents a shift from the previous June auction, where the 2035 and 2037 bonds cleared at higher rates. The August rates remain lower than the June levels, but investors continue to commit significant funds to longer-duration sovereign debt despite the lower yields, anticipating a moderation in yields ahead. The August auction outcome highlights the Federal Government's continued reliance on domestic borrowing to finance fiscal obligations.