Reps In Rowdy Session Over Call To Summon Tinubu

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ABUJA – Tempers flared in the House of Repre­sentatives on Wednesday as lawmakers became embroiled in a bitter confronta­tion over calls to invite President Bola Ahmed Tinubu to explain persistent de­lays in implementing the 2025 Appropri­ation Act, exposing growing frustration within the legislature over the pace of budget execution and the fate of constit­uency projects nationwide.

The dramatic exchange unfolded during consideration of a motion spon­sored by Hon. Alex Mascot Ikwechegh, who accused fiscal authorities of failing to release appropriated funds promptly, leaving critical government projects stalled and contractors burdened by mounting debts despite existing bud­getary provisions and presidential di­rectives.

Presenting the motion, Ikwechegh maintained that the effectiveness of any appropriation law depends not merely on its passage by the National Assembly but on the prompt release, cash-backing and utilisation of funds by Ministries, Departments and Agencies (MDAs).

He informed the House that report sing has heightened investor concerns over the volume of sovereign debt expected to flood the market, prompting market participants to demand higher returns before committing fresh funds.

The Debt Management Office (DMO) reinforced those con­cerns in June by announcing a record N1.2 trillion bond offer at its monthly auction, the largest single-auction issuance ever con­ducted by the agency.

The unprecedented offer size was widely interpreted as a signal of the government’s growing financing needs and strengthened expectations that debt supply will remain elevated over the coming months.

As expected, investors re­sponded by repricing bonds upward.

At the auction, the marginal rate on the August 2030 FGN bond rose to 16.30 percent from 16.00 percent at the previous auc­tion, while the June 2032 bond settled at 16.50 percent compared to 16.15 percent previously.

The higher stop rates con­firmed that investors were de­manding greater compensation to absorb the expanding supply of government securities.

Beyond increased debt issu­ance, analysts noted that infla­tion concerns and the Central Bank of Nigeria’s tight mon­etary policy also continued to shape investor behaviour.

Although inflation has mod­erated considerably compared with levels seen in previous years, market participants re­main cautious about upside risks, especially in light of persistent food price pressures and external geopolitical devel­opments that could influence energy prices and imported inflation.

The CBN’s decision to main­tain a tight monetary stance has equally supported higher yields across fixed-income instru­ments, as elevated policy rates continue to influence pricing throughout the financial system.

Consequently, the sell-off spread across the entire FGN bond yield curve.

The mid-tenor segment re­corded the sharpest adjustment, with average yields increasing by 158 basis points month-on-month.

The short end of the curve followed closely, recording a 144-basis-point increase, while yields on long-dated bonds rose by 142 basis points during the review period.

The broad-based nature of the sell-off suggests that inves­tors remain cautious irrespec­tive of maturity profile, prefer­ring to price in the possibility of sustained debt issuance through­out the year.

The bearish sentiment was equally evident in the Nigerian Treasury Bills (NTBs) market.

Average NTB yields rose by 103 basis points month-on-month to 18.54 percent as inves­tors adjusted their expectations to reflect tighter liquidity con­ditions and the prospect of in­creased Treasury Bill issuance by the Central Bank of Nigeria (CBN).

Market analysts noted that Treasury Bills have continued to attract strong institutional in­terest because of their relatively short duration and attractive returns.

However, the anticipated increase in supply has also re­sulted in higher required yields, contributing to the upward trend observed in June.

Nigeria’s Eurobond market also experienced weaker inves­tor appetite during the month.

Average Eurobond yields rose by 76 basis points to approx­imately 7.54 percent as global investors became increasingly cautious amid heightened geo­political risks and persistent uncertainty in international financial markets.

Analysts attributed the weaker sentiment partly to re­newed tensions in the Middle East, which have increased risk aversion among international investors and reduced demand for emerging market debt instru­ments.

The shift in global sentiment affected sovereign bonds across several developing economies, including Nigeria, despite im­proving domestic macroeconom­ic fundamentals.

Looking ahead, analysts be­lieve the outlook for Nigeria’s fixed-income market remains tilted towards higher yields.

Although inflationary pres­sures have shown signs of eas­ing, uncertainty surrounding global developments continues to warrant caution from both investors and policymakers.

The renewed geopolitical tensions in the Middle East, volatility in crude oil prices and uncertainty over global interest rate movements are expected to influence investment decisions in the coming months.

More importantly, analysts believe domestic borrowing requirements will remain the dominant driver of market sen­timent.

The DMO has unveiled an ambitious borrowing pro­gramme for the third quarter of 2026, targeting between N3.8 trillion and N4.9 trillion from the domestic bond market.

The planned issuance rep­resents a significant increase from the N2.5 trillion offered during the second quarter, high­lighting the government’s deter­mination to raise substantial funding from local investors.

Similarly, the Central Bank of Nigeria has announced plans to issue N5.8 trillion worth of Ni­gerian Treasury Bills during the third quarter.

This compares with expected maturities of only N2.6 trillion and exceeds the approximately N4 trillion worth of Treasury Bills offered during the second quarter of the year.

Analysts said the large vol­ume of planned issuances indi­cates that supply pressures will remain elevated throughout the third quarter, making it difficult for yields to decline meaningfully despite improving inflation dy­namics.

According to market experts, investors are likely to continue demanding attractive yields to compensate for increased sup­ply, while institutional investors such as pension fund administra­tors, banks and asset managers are expected to remain selective in their portfolio allocations.

They added that unless the government scales back its borrowing programme or the central bank adopts a more ac­commodative monetary policy stance, Nigeria’s fixed-income market is likely to remain under pressure.

For investors, the environ­ment presents opportunities to lock in higher yields, while for government, it signals the rising cost of financing an am­bitious fiscal programme amid persistent domestic and global economic uncertainties.

As the third quarter unfolds, market participants will closely monitor inflation trends, mone­tary policy signals and the pace of government debt issuance, all of which are expected to de­termine the direction of yields and overall investor sentiment in Nigeria’s fixed-income market.