Nigeria raises N5.08 trillion from domestic bonds in H1 2026

• Up 77.8%, as borrowing to finance fiscal needs •May crowd out private sector credit

Nigerian government’s commitment to boost the domestic bond market attained its peak in the first half of 2026 (H1 2026) with 78 percent year on year (Y/Y) increase in local borrowing, compared with the same period in 2025.

Nigeria’s Federal Government raised N5.08 trillion from the domestic bond market in the first half of 2026, up 77.8% from a year earlier.

The elevated borrowing is driven by the government’s intensified need for more fund to finance fiscal needs.

However strong investor demand pushed total subscriptions above N9 trillion despite higher bond issuance, while borrowing costs eased compared with 2025.

As a result, long-term bonds attracted the strongest interest, with January and June recording the highest borrowings.

Meanwhile, analysts warned that increased government borrowing could crowd out private sector credit and raise debt-servicing costs.

The market analysts also emphasised that higher coupons of federal government issued bonds could also weaken the equities market segment as more fund may likely exit the volatile equities market to the bond market.

The trend, the analysts maintain, is likely to prevail as bond yields are expected to remain elevated amid persistent inflation and tight monetary policy