Last week, the Central Bank of Nigeria, (CBN) conducted back-to-back OMO auctions alongside the pre-scheduled Nigerian Treasury Bill (NTB) sale, prompting strong demand across tenors as investors sought short- to mid-term instruments. The Central Bank of Nigeria’s (CBN) decision to introduce new maturities and lower stop rates despite heavy subscriptions reinforced a deliberate strategy to compress yields and absorb excess liquidity, maintaining monetary tightening while guiding market expectations. The NTB auction revealed investor preference for the one-year paper, highlighting a shift toward duration amid moderating inflation sentiment and stable policy rates.
Nigeria’s reserves edged higher, the Naira strengthened modestly against the dollar, and global commodities traded with mixed sentiment. Gold extended its record rally on safe-haven demand, while crude prices eased as geopolitical tensions subsided despite midweek support from inventory drawdowns and restrained OPEC+ output. The Nigerian equity markets maintained positive momentum, driven by renewed buying in large-cap stocks. Overall, the week reinforced cautious optimism, anchored on disciplined liquidity management, improving FX stability, and a tempered global risk sentiment. The commodities markets ended the week in a mixed position; gold posted an intra-week gain of 0.9% to close at $3,988.08/oz, crude oil extended its losses with WTI was down by 5.45% at $58.24, and Brent shed 4.92% to $62.17 per barrel. While the NGX ASI advanced 1.58% to 146,988.00 points.
Interbank liquidity opened with a surplus of over ₦3.3 trillion on Friday, marking an intra-week drop (-45.99%) after opening at ₦6.11 trillion on Monday. Money market rates held steady for the Open Repo Rate (OPR) at 24.50% and Overnight (O/N) mild change of +0.36% to 24.97%, closing the week at 24.50% and 24.97%, respectively. The local currency traded between $/₦1,455.17 and $/₦1,471.08 during the week, and closed at $/₦1,458.00 on Friday.
The fixed income space witnessed yield-directing events, including OMO auctions in addition to the scheduled NTB auction. The OMO auctions conducted by the CBN on October 6th, 7th and 10th, 2025 reflected intense liquidity chasing short-term yields, evidenced by aggressive mega demand across all tenors against their offer. The Apex bank issued short (81-, 85-, and 99-day bills) and mid-tenors (120-, 151-, 168-, and 196-day bills). The first auction witnessed demand of 2.15x, 2.64x, and 15.85x, respectively, for the 85-day, 99-day, and 120-day. The second OMO auction featured 168- and 196-day notes with oversubscription of 5.71x and 9.04x separately against their offers. The CBN strategically increased allotments beyond the offer size, especially for the 168-day and 196-day bills, where allotment on offer were 445% and 567% respectively. Besides a third set of sale that presented 81-, 109- and 151-day papers, the result showed sharp divergence in investor’s appetite across tenors; with the 81-day bill recording a weak subscription of 0.1x its offer, leading to a minimal 2.5% allotment on offer, indicating low interest at the short end. In contrast, demand was significantly stronger for the 109-day and 151-day papers, attracting 2.18x and 8.15x in bids, respectively, with an oversale on offer of 137.6% and 500% correspondingly. These allotments signalled an aggressive liquidity mop-up move. The mid-tenor bid range was indicative of broad yield expectations, nonetheless the CBN cut stop rates at mid-19% band, signalling a yield reduction-driven strategy despite ample demand that could have supported higher cut-off rates.
Notably, all stop rates dropped below previous levels, with the 168- and 196-day bills clearing at 19.45%(-72bps) and 19.49%(-68bps) from a previous 20.17% for the mid-dated note (120 days), in addition to the 81-, 109- and 151-day sold at 19.35%(-73bps), 19.39%(-74bps) and 19.44%(-1bps) separately, marking a clear downward re-pricing trend. Overall, the outcomes show that the CBN leveraged strong demand to lower its cost of OMO refinancing, while mopping up excess systemic liquidity. The market’s willingness to accept sub-20% levels for the mid-tenor OMO bills confirms a shift in the investor outlook, likely tied to inflation moderation bets or positioning ahead of policy easing signals. However, the scale of liquidity absorption suggests the CBN is not aggressively easing liquidity policy, but as an alternative use a controlled yield curve re-alignment, lowering front-end rates while draining liquidity to maintain FX and inflation stability. Despite the declining stop rate, the true yield of these maturities reflected the compression from 28% levels to a range of 20%-21% levels in recent auctions. Using maturity month comparison, the effective yield for the auction batch notes is in the table below
1st Auction | Effective Yield (%) | 2nd Auction | Effective Yield(%) | 3rd Auction | Effective Yield(%) |
85-Day | 21.01(-72bps) | 168-Day | 21.40(-20bps) | 81-Day | 20.22(-151bps) |
99-Day | 21.30(-43bps) | 196-Day | 21.80(-20bps) | 109-Day | 20.60(-70bps) |
120-Day | 21.60(-60bps) |
|
| 151-Day | 21.14(-26bps) |
OMO Auction – October 6, 7 & 10, 2025
TENOR | AUCTION DATE | OFFER (₦‘ B) | BIDS (₦‘ B) | RANGE OF BIDS (%) | STOP RATES (%) | PREVIOUS STOP RATES (%) | TOTAL SALE (₦‘ B) |
85-DAY | 06-10-2025 | 200.00 | 430.25 | 19.9900-23.1900 | 20.0800 | 20.4900 | 158.00 |
99-DAY | 06-10-2025 | 200.00 | 527.10 | 20.0000-22.9700 | 20.1300 | 20.4900 | 240.10 |
120-DAY | 06-10-2025 | 200.00 | 3,170.74 | 20.0000-22.9400 | 20.1700 | 20.6100 | 600.00 |
168-DAY | 07-10-2025 | 300.00 | 1,713.85 | 18.1900-22.0200 | 19.4500 | 20.1700 | 1,335.60 |
196-DAY | 07-10-2025 | 300.00 | 2,711.75 | 18.2900-21.6500 | 19.4900 | 20.1700 | 1,700.00 |
81-DAY | 10-10-2025 | 200.00 | 20.00 | 19.3500-19.8500 | 19.3500 | 20.0800 | 5.00 |
109-DAY | 10-10-2025 | 200.00 | 435.10 | 18.9000-21.5400 | 19.3900 | 20.1300 | 275.10 |
151-DAY | 10-10-2025 | 200.00 | 1,629.25 | 19.2500-21.0400 | 19.4400 | 19.4500 | 1,000.00 |
The October 8, 2025, Nigerian Treasury Bill (NTB) reflected a sharply split demand profile across tenors. As usual, short- and medium-term papers were markedly undersubscribed: the 91-day received 26% and the 182-day drew 43.4% to its offer. By contrast, the 364-day attracted an enormous bid of 282% of its offer. The DMO responded with an allotment on offer of: 25.4%, 34.4%, and 143.8% (~51% of the total subscription) for the 91-, 182- and 364-day bills, respectively. The outcome signifies that the investors largely avoided the very short end, aggressively chased the one-year paper, and the issuer both increased long-dated supply and controlled allocations amid the flood of bids.
The stop-rate movements mirror that behaviour with 91-day unchanged at 15.00%, while the 182-day fell modestly at 15.25%(-5bps) and the 364-day plunged steeply at 15.77%(-101bps). The sharp compression at the long end, despite massive demand, signals a strong willingness to lock in one-year yields and reduce the marginal cost of long-dated borrowing for the government. These outcomes reflect yield-chasing amidst ample liquidity, and repositioning on expectations of easing. For investors, short-term bills are harder to place (raising rollover risk if dependency continues), while the window to lengthen debt at lower cost has opened; this position however is sensitive, if liquidity or expectations reverse, yields could re-price sharply.
NTB Auction – October 8, 2025
AUCTION DATE | 08-10-2025 | 08-10-2025 | 08-10-2025 |
ALLOTMENT DATE | 09-10-2025 | 09-10-2025 | 09-10-2025 |
MATURITY DATE | 08-01-2026 | 09-04-2026 | 08-10-2026 |
TENOR | 91-DAY | 182-DAY | 364-DAY |
OFFER (₦) | 100,000,000,000 | 120,000,000,000 | 350,000,000,000 |
SUBSCRIPTION (₦) | 25.974.863,000 | 52,122,940,000 | 986,334,013,000 |
ALLOTMENT (₦) | 25.374.862,000 | 41,327,100,000 | 503,298,038,000 |
RANGE OF BIDS (%) | 14.4000 – 17.0000 | 14.5000 – 19.0000 | 14.7000 – 22.0000 |
STOP RATES (%) | 15.0000 | 15.2500 | 15.7700 |
PREVIOUS STOP RATES (%) | 15.0000 | 15.3000 | 16.7800 |
The Naira appreciated slightly against the US dollar during the review period, opening at $/₦1,470.26 on October 6 and closing at $/₦1,455.17 on October 10, reflecting a modest gain of ₦15.09, supported by improved FX liquidity and sustained market interventions. In the past two weeks (September 30 to October 10, 2025), Nigeria’s gross reserves improved from $42.3539bn to $42.5761bn (+0.52%), while liquid reserves grew from $41.6773bn to $41.9123bn (+0.55%) and enhanced usable FX buffers. In contrast, blocked reserves declined from $676.65m to $663.76m, representing a 1.90% reduction, indicating a slight easing in constrained assets and increasing overall reserve liquidity
The sustained appetite across sovereign bonds and money market instruments is a direct consequence of surplus liquidity. As the secondary market was active during the week, after trading briefly around 15% levels, yields in the market adjusted back to 16% by Friday as sentiments started to balance out in addition to the CBN moves to mop up liquidity through simultaneous OMO auctions. The fixed income space was largely active on mid-long tenor bonds especially 2029s, 2031s, 2032s, 2033s, 2034s, 2035s, Sukuk-32s and 33s. Activity on T-bill and OMO papers were elevated, particularly at the mid-to-long end of the curve with T-bills maturing 3-Sept., 17-Sept., 8-Oct., in addition to OMO maturing on 7-Apr., 3-Feb., 10-Mar., and 17-Mar.
The World Bank’s October 2025 Nigeria Development Update Report highlights that while macroeconomic reforms such as FX unification, petrol subsidy removal, and tighter monetary policy, have stabilized the exchange rate, boosted FX reserves, and lifted fiscal revenues, the benefits have not yet translated into broad-based welfare gains, as food inflation remains stubbornly high and poverty continues to rise, projected at 62% of the population in 2026 despite improved current account surplus and stronger reserves
Given this disconnect between macro stability and household well-being, policies must urgently shift from stabilization to inclusive impact, with a strong recommendation for the administration to deepen social protection delivery, improve transparency in fiscal reporting, and channel the gains from subsidy removal and revenue increase into targeted food inflation relief, rural productivity support, and state-level infrastructure cohesion to prevent reform fatigue and social pushback.
Prices were largely steady through the week, mirroring volatility in broader commodity markets as gold surged to record highs before easing slightly. Gold prices opened the week at $3,952.27/oz (+1.71%) on Oct. 6, climbed to $3,976.60/oz (+0.62%) on Oct. 7, broke the $4,000/oz barrier to reach a record $4,052.44/oz (+1.915) on Oct. 8, then slipped to $3,978.19/oz (-1.83%) on Oct. 9 following a ceasefire between Israel and Hamas, and finally stabilized at $3,988.08/oz (+0.25%) on Oct. 10. Despite midweek profit-taking, bullion posted a 0.9% week-to-date gain and remains up over 52% year-to-date, supported by persistent geopolitical tensions, ongoing US government shutdown concerns, and growing expectations of further Federal Reserve rate cuts that continue to support safe-haven demand.
All Share Index (ASI) Snapshot
The Nigerian All-Share Index (ASI) maintained a positive tone through the week, advancing upward on sustained investor interest in large-cap stocks. The index opened at 144,698.00 on October 6, edging by 2,290 points and a week-to-date (WTD) gain of 1.58%, to close at 146,988.00 on October 10, as sustained buying interest lifted the market.
Brent crude futures ended the week lower at $62.17 per barrel on October 10, down from $65.39 on October 6, while WTI settled at $58.24 per barrel, easing from $61.60 at the start of the week, driven by the renewed US-China trade tensions, which rattled markets and geopolitical tensions which offset earlier gains powered by supply developments. Prices initially rose after OPEC+ announced a modest 137,000 bpd production increase for November, well below market expectations, signalling a cautious approach to output management. Midweek, both benchmarks touched multi-day highs (Brent at $66.42, WTI at $62.81) following data showing a sharp drawdown in crude inventories at the Cushing hub, before retreating as news of a ceasefire agreement between Israel and Hamas reduced risk premiums. Despite the late pullback, both Brent and WTI remained marginally low with week-to-date at -4.92% and -5.45% respectively, supported by U.S. sanctions on Iranian oil networks, falling refined product stocks, and OPEC+’s disciplined supply strategy, amplifying a market delicately balanced between geopolitical relief and tightening fundamentals.
It is very likely that the impact of President Trump’s threatened tariff imposition on China as witnessed on Friday across risk markets open at the time will spill over and trickle into the Nigerian markets. We expect a sell-off at the open in the equity space and similar impact to be felt in the fixed income market. Depending on how the China/US rhetoric echoes into the week, we may see Foreign Portfolio Investments (FPI) shift to risk-off mode thus affecting their patronage of Emerging Markets considerably. We expect oil prices to remain relatively know until tensions resurface. Cryptocurrencies are expected to retest the weekend’s lows before they settle depending on the US/China matter.
By: Sandra A. Aghaizu
The week was a stormy sea for oil…
Brent and WTI drifted downward,
Their sails, once full, now caught in the crosswinds
Of trade wars and uneasy truces.
OPEC+ whispered restraint,
A modest 137,000 barrels a droplet,
Not a flood,
Signalling prudence in a market,
That listens to every sigh of supply.
Midweek, hope flickered.
Cushing’s wells ran lighter,
And prices climbed like sunlight through cloud.
But peace talks between Israel and Hamas
Breathed calm into the tempest,
And the risk winds softened.
By week’s end, black gold lay still,
Its shimmer dimmed by nearly five percent,
Yet beneath the quiet surface
Flowed unseen currents
U.S. sanctions tightening Iran’s veins,
Refined stocks thinning,
And OPEC’s steady hand
Keeping balance on a trembling scale.
The market, like a heartbeat,
Throbbed between fear and faith.
Caught in the fragile dance
Of fire, politics,
And the deep, dark pulse of the earth.
