The Debt Management Office allotted N2.02 trillion in Federal Government bonds at its 19 October auction as yields on two long-term securities rose by up to 50 basis points.
The DMO allotted N1.22tn through competitive bidding, up 63.5 per cent from N748.64bn in September, while non-competitive sales accounted for another N800bn.
The stop rate on the September 2036 bond rose to 17.29 per cent from 16.79 per cent, while the June 2038 bond increased to 17.19 per cent from 16.85 per cent. The February 2034 bond cleared at 16.99 per cent.
The agency offered N1.75tn across three bonds and received bids worth approximately the same amount. It rejected N523.58bn in subscriptions through competitive bidding.
The September 2036 bond attracted the highest bids at N925.35bn against N800bn offered, while the June 2038 bond received N518.32bn against N450bn.
Demand was weaker for the February 2034 bond, which attracted N304.08bn against N500bn offered.
Total subscriptions rose 17 per cent to N1.75tn from N1.49tn in September. Successful bids increased to 274 from 204, while total bids rose to 443 from 441.
The increase in yields reversed part of the recent decline in borrowing rates. The June 2038 bond’s stop rate fell from 18.40 per cent in July to 16.85 per cent in September before rising to 17.19 per cent in October.
The trend also follows developments in the Treasury bills market, where the DMO raised the one-year stop rate to 15.90 per cent from 15.85 per cent at its 14 October auction.
The increase came weeks after the Central Bank of Nigeria cut its benchmark interest rate by 350 basis points to 23 per cent on 22 September.
Higher yields could raise the government’s borrowing and debt-servicing costs, while offering investors better returns on newly purchased securities.