Nigerian bond yields are seen rising next week on profit taking by investors, some of who will be preparing for a primary auction due in mid-February.
Yields have been mixed this week, with some lenders mopping up the 2024 tenor debt note to use as collateral for foreign exchange credit lines.
Dealers said the demand in the paper, which is one of the listed Nigerian bond on the JP Morgan index, has been spurred by structured buying where some banks buy up local assets to serve as collateral for their foreign line of credit.
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“We noticed that yields on the 2024 bond have fallen by around 0.39 percentage points week-on-week due to an increase in buying by some banks,” one dealer said.
Yields on the 2024 paper were trading around 15.06 percent from 15.45 percent on Monday. The 2016 bond was trading at 15.03 percent, up from 14.75 percent, while the 2022 note was trading at 15.20 percent from 15.22 last week.
