The Debt Management Office (DMO) has announced the successful completion of its Federal Government of Nigeria (FGN) bond auction, with a total of N185.9 billion allotted across two re-opened bond offerings.

The auction, held on July 28, 2025, featured the reopening of two previously issued FGN bonds:

• N20 billion for the 19.30% FGN APR 2029 bond (five-year tenor).

• N60 billion for the 17.95% FGN JUN 2032 bond (seven-year maturity).

Settlement is scheduled for July 30, 2025.

Auction Performance

According to data released by the DMO, subscriptions amounted to N39.08 billion for the 5-Year APR 2029 bond and N261.60 billion for the 7-Year JUN 2032 bond.

Out of these bids, the DMO allotted N13.43 billion for the APR 2029 bond and N172.50 billion for the JUN 2032 bond, totaling N185.93 billion, well above the initial offer size.

While the bonds retained their original coupon rates of 19.30% and 17.95%, they were allotted at marginal rates of 15.69% (5-Year bond) and 15.90% (7-Year bond). Analysts note this reflects a decline in yield expectations, suggesting investors anticipate easing inflation or a stable monetary policy outlook.

The reopening attracted 149 bids—40 for the 2029 maturity and 109 for the 2032 maturity. Of these, 74 bids were successful (15 for the 2029 bond, 59 for the 2032 bond).

Comparison with June 2025 Auction

In June 2025, the total allotment was N100 billion, lower than July’s results.

• The 5-Year APR 2029 bond (coupon: 19.30%, maturity: April 17, 2029) attracted 30 bids worth N41.69 billion, but only two bids were successful, with an allotment of N1.05 billion.

• The 7-Year JUN 2032 bond (coupon: 17.95%, maturity: June 25, 2032) attracted 209 bids totaling N561.17 billion. Out of these, 41 bids were accepted, with an allotment of N98.95 billion.

Regulatory Framework

The bond issuance was carried out under the Debt Management Office (Establishment) Act, 2003 and the Local Loans (Registered Stock and Securities) Act, CAP. L17, Laws of the Federation of Nigeria 2004.

The marginal rates for successful bids were:

• 17.75% for the 19.30% FGN APR 2029 (5-Year Reopening).

• 17.95% for the 17.95% FGN JUN 2032 (New, 7-Year).

Investor Information

• Each bond unit is priced at N1,000, with a minimum subscription of N50,001,000. Additional subscriptions must be in multiples of N1,000.

• Though coupon rates are fixed, successful bidders pay a price determined by yield-to-maturity that clears the offered volume, plus accrued interest.

• Interest is payable semi-annually, ensuring regular income to bondholders.

• Principal repayment will be made in full at maturity via bullet repayment.

August 25, 2025 | Economy, GDP, Spotlight

Nigeria’s economy is projected to post stronger growth in Q2 2025, with analysts forecasting real GDP expansion between 3.2% and 3.9%.

This outlook would surpass both the 3.13% growth recorded in Q1 2025 and the performance in the same quarter of 2024, reflecting improved macroeconomic stability and rising non-oil output.

The optimism is supported by the recent GDP rebasing, relative exchange rate stability, and expansion across financial services, telecommunications, and industry.

The National Bureau of Statistics (NBS) is expected to release the official GDP report later this month.

Expert Projections

Experts forecast growth of 3.5%–3.7%, noting that the GDP rebasing has sharpened visibility into sectoral performance. The Purchasing Managers’ Index (PMI) averaged 52.2 points in Q2, up from 51.3 in Q1 2025 and 48.0 in Q2 2024, signaling stronger business activity.

“The Nigerian economy appears well positioned to record stronger growth in Q2 2025, outpacing both Q1 2025 and the corresponding period of 2024,

The projects growth between 3.2% and 3.9%, led by a robust non-oil sector expected to expand by 4.1%–4.6%, while the oil sector is projected to post a modest 2.0%–2.6% gain.

Oil sector performance remains subdued, with crude output steady at 1.48 mbpd in Q2 (vs. 1.47 mbpd in Q1) and weaker oil prices averaging $68.70/barrel compared to $73.66 in Q1. Analysts attribute this to reduced global demand following the so-called “Trump tariff effect.”

The non-oil economy, however, continues to gain traction.

Services remain the primary driver, boosted by bank recapitalisation in finance & insurance.

Telecommunications benefit from tariff liberalisation.

Industry is expected to edge up to 3.6% growth in Q2 from 3.4% in Q1, helped by easing inflation and FX stability.

Agriculture is likely to underperform, growing below its long-term 3% average due to persistent insecurity in key food-producing states such as Benue and Plateau.

They believe macroeconomic stability is central to the positive outlook.

“Considering the moderating inflation, stable currency, and increasing foreign reserves, GDP is expected to have grown in Q2 2025,” he said.

Key Drivers of Expected GDP Growth in Q2 2025

GDP rebasing: Enhances visibility of fast-growing sectors, particularly services and telecoms.

Macro stability: Inflation is easing, FX volatility has moderated, and reserves are improving.

Business activity: PMI of 52.2 reflects stronger private-sector output.

Non-oil momentum: Services, telecoms, and industry continue to expand, offsetting oil sector weakness.

The latest inflation report from the National Bureau of Statistics (NBS) shows that Nigeria’s headline inflation eased to 21.88% in July 2025, down slightly from 22.22% in June. This represents a significant 11.52 percentage-point decline from the 33.40% recorded in July 2024, partly reflecting the rebasing of the Consumer Price Index to November 2009 = 100.

On a month-on-month basis, however, inflation accelerated to 1.99% in July, up from 1.68% in June, signalling that while the annual rate has moderated, price pressures remain elevated at the consumer level. The 12-month average inflation rate fell to 25.65%, compared to 30.76% over the same period in 2024.

Urban vs Rural Dynamics

• Urban inflation slowed to 22.01% year-on-year (July 2025), from 35.77% a year earlier, with the monthly reading declining to 1.86% (vs. 2.11% in June). The urban 12-month average stood at 27.04%, also down from 32.89% in 2024.
• Rural inflation printed at 21.08% year-on-year, down from 31.26% in July 2024. However, rural price pressures were more acute on a monthly basis, with inflation rising sharply to 2.30% in July, from just 0.63% in June. The 12-month average rural inflation eased to 23.84%, compared to 28.86% in July 2024.

Food Prices — Still the Key Driver

Food inflation, the most sensitive component to household welfare, eased substantially to 22.74% year-on-year in July, compared to 39.53% in July 2024. Month-on-month, food inflation moderated slightly to 3.12% from 3.25% in June.
According to the NBS, the downward trend was supported by softer prices for vegetable oil, white beans, local rice, maize flour, guinea corn, wheat flour, and millet. The 12-month average food inflation dropped to 26.97%, from 36.36% in the prior year.

Core Inflation — Energy and Imported Pressures Ease

Core inflation, which strips out volatile agricultural and energy prices, slowed to 21.33% year-on-year in July, compared to 27.47% in July 2024. On a monthly basis, core inflation fell markedly to 0.97% in July, down from 2.46% in June. The 12-month average core inflation eased marginally to 23.63%, from 24.65% a year earlier.

Outlook and Policy Considerations

The data suggests that improved domestic food supply, relative exchange rate stability, and moderation in energy costs are beginning to filter through to consumer prices. Analysts note that the ongoing harvest season for staples such as maize, yam, and cassava has eased market shortages and provided some relief to households.

That said, the persistence of elevated month-on-month inflation underscores the fact that underlying cost pressures remain entrenched. For policymakers, this means that while the disinflation trend is welcome, monetary and fiscal authorities must remain cautious and proactive.

• For the Central Bank of Nigeria (CBN), the challenge is to balance price stability with credit availability. While maintaining a restrictive stance through the Monetary Policy Rate (MPR) is necessary, complementary tools such as targeted credit interventions to the agricultural and energy sectors can help ease supply-side constraints.
• On the fiscal side, the government must address structural bottlenecks, particularly in logistics, power supply, and insecurity in food-producing regions, which continue to fuel cost-push inflation.
• Most importantly, anchoring inflation expectations through credible policy signaling will be key to consolidating the downward trend in headline inflation.

In summary, Nigeria’s inflationary environment is showing signs of improvement, but sustained progress will require a careful blend of monetary discipline, fiscal reforms, and structural interventions to secure lasting price stability.