Nigeria's fixed-income market to get N11tn liquidity in October, Cordros says
Nigeria's fixed-income market is expected to receive approximately N11 trillion in liquidity inflows during October 2026, according to Cordros Capital's September 2026 Fixed Income Monthly Review. The inflows comprise N9.05 trillion from Open Market Operations (OMO) maturities (82% of total), N1.30 trillion from Nigerian Treasury Bill (NTB) maturities, and N650.67 billion from FGN bond coupon payments.
This liquidity could sustain reinvestment demand and put downward pressure on yields. However, Cordros notes that fresh OMO and NTB auctions may absorb a significant portion, potentially sterilizing inflows and limiting yield impact. The timing of OMO repayments and CBN sterilization scale will be crucial.
This follows September's trend where N13.14 trillion in maturing OMO securities fueled reinvestment demand, coinciding with yield declines after the MPC cut rates by 350bps to 23% on September 22. Cordros forecasts September inflation at 15.40% (up from August's 15.39%), limiting room for further rate cuts.
While Nigeria's inclusion in JP Morgan's GBI-EM Edge index (7.4% weighting) may support foreign participation, fresh government borrowing competes for the same liquidity. Cordros expects liquidity and foreign demand to remain supportive, but sterilization, new issuance and inflation risks could moderate any further decline in fixed-income yields.
Given these opposing forces—liquidity inflows supporting yields versus sterilization, inflation and new issuance pressuring them—how should investors position their fixed-income portfolios for October?