Nigerian govt’s borrowing gets tougher as investors ignore bond

The Federal government of Nigeria faces an uphill task in finding creditors to plug the hole in its finances.

The latest data from the Debt Management Office (DMO) shows for the first time in 2022, Nigera has failed to get investors to buy into Federal Government bonds.

DMO website shows that Federal Government in October was looking to raise N225 billion but only got N107.88bn.

This represents a shortfall of N117 billion and signals investors’ concerns amid rising inflation and Central Bank of Nigeria’s strict policies.

READ ALSO:DMO defends Nigerian govt’s borrowings to fund fuel subsidy

Unlike previous auctions with records of oversubscription, the total subscription level recorded at the October auction was the lowest so far in 2022.

The performance of the Nigerian government bond in October could endanger its ability to finance the 2022 budget deficit, and it may have to seek help from the CBN.

Already, CBN in 2022 has provided over N4 trillion bail out fund, which many analysts considered very excessive.

Ripples Nigeria had earlier reported that the federal government is currently owing CBN over N20 trillion.

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