Analysts Sees Drop in FGN Bond Prices

By Modupe Gbadeyanka

Last week, the value of FGN bonds traded at the over-the-counter (OTC) segment depreciated for most maturities tracked amid sustained bearish activity, with the corresponding yields rising.

However, this week, analysts at Cowry Asset project a further decline in the bond prices amid expected tight liquidity.

“In the new week, we expect FGN bond prices to decline (with corresponding rise in yields) at the OTC market amid expected stain in financial system liquidity,” they said.

During trading last week, the 5-year, 14.50% FGN JUL 2021 paper, the 10-year, 16.29% FGN MAR 2027 debt and the 20-year, 16.25% FGN APR 2037 bond tanked by N0.93, N1.14 and N0.93 respectively; their corresponding yields increased to 14.90 percent from 14.40 percent, 14.69 percent from 14.46 percent and 14.45 percent from 14.32 percent respectively.

However, the 7-year, 13.53% FGN MAR 2025 note rose by N0.55, and its corresponding yield fell to 14.25 percent from 14.40 percent.

Elsewhere, the value of the FGN Eurobonds traded at the international capital market depreciated for all maturities tracked amid renewed profit taking activity – the 10-year, 6.75% JAN 28, 2021 paper, the 20-year, 7.69% FEB 23, 2038 and 30-year, 7.62% NOV 28, 2047 bonds lost $0.17, $1.27 and $1.68 respectively; their corresponding yields fell to 4.96 percent from 4.88 percent, 7.87 percent from 7.74 percent and 7.98 percent from 7.83 percent respectively.

Modupe Gbadeyanka is a fast-rising journalist with Business Post Nigeria. Her passion for journalism is amazing. She is willing to learn more with a view to becoming one of the best pen-pushers in Nigeria. Her role models are the duo of CNN's Richard Quest and Christiane Amanpour.

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