Nigeria’s debt market has grown significantly, with the total outstanding debt reaching ₦91.99 trillion for the week ended November 7 2025. Market participants attribute this surge to rising yields across various segments of the fixed-income market, driven by sell-pressure and expectations of tighter monetary policy from the Central Bank of Nigeria (CBN).
The data, provided by FMDQ Group Plc, reveals a 3.59 % week-on-week increase in market size, a marked rebound from recent weeks when the market valuation had dropped to around ₦87 trillion. Analysts interpret this sudden expansion as a response to growing investor caution: yields rising, shorter-term instruments increasingly demanded, and overall appetite shifting amid volatility.
In the treasury bills segment, the 5-February-2026 bill saw its yield surge by 56 basis points to 16.23 %, the largest jump among the short-dated instruments. Meanwhile, the 7-May-2026 and 5-November-2026 bills recorded more modest increases of 6 bps and 2 bps respectively. On the sovereign bond front, yields have also crept up: the 17-April-2029 bond rose by 10 bps to 15.87 %, the 2036 maturity stood at 15.67 %, and the 2049 issue at 15.57 %. These moves reflect investor expectations around inflation and the timing of upcoming bond reopenings.
Corporate debt instruments have similarly seen repricing. For example, the yield on Dangote Industries Funding Plc (2032 maturity) increased by 11 bps to 17.69 %; the yield on Axxela Funding 1 (May 2027) edged up 3 bps to 20.35 %; and the yield on NSP‑SPV PowerCorp (Feb 2034) climbed 22 bps to 17.02 %. Short-term commercial papers also got pricier, with yields on Dangote Sugar Refinery Plc and UAC of Nigeria Plc at 23.96 % and 22.86 % respectively, reflecting renewed corporate funding demand amid tighter liquidity.
In the money‐market, repo rates remain elevated. Overnight rates increased by 7 bps to 24.79 %, while open repos held steady at 24.50 %. Futures contracts for government bonds also strengthened: for example, the 12-month/2-year FGN bond future climbed to 107.58, while the 10-year future reached 132.08, suggesting some investor optimism about yields moderating later on.
Looking ahead, the restrictive monetary stance of the CBN, persistently high inflation and tight liquidity conditions are expected to keep borrowing costs elevated. Analysts warn that issuers will face a tougher financing environment in the weeks to come. The upcoming government bond auction scheduled for November 24 will be closely watched, particularly in comparison to recent state bond issuances such as the ₦200 billion issue by Lagos State.
The sharp rise in yields and expanding debt market size increase Nigeria’s cost of borrowing, squeezing public finances and diverting funds from growth-oriented spending. Higher debt servicing impairs fiscal flexibility, while elevated yields may deter private investment, slowing broader economic recovery in a country already wrestling with inflation and currency pressures.
