Nigeria’s fixed-income market is projected to witness a surge in liquidity inflows in May 2026, with the Financial Markets Dealers Association (FMDA) estimating a total of N10.53 trillion entering the system, largely driven by elevated Open Market Operations (OMO) maturities.
The projection was disclosed in the FMDA Monthly Market Report published on Tuesday, May 5, 2026.
The anticipated increase from April’s N9.08 trillion signals a stronger liquidity environment that could shape interest rate movements and investment decisions across the market.
What the data is saying
The FMDA report highlights that OMO maturities will dominate inflows in May, reinforcing their role as the primary liquidity driver in the financial system. Other instruments, including Treasury bills, FAAC disbursements, and bond coupon payments, are also expected to support overall inflows.
- OMO maturities are projected at N7.17 trillion in May, up from N5.88 trillion recorded in April, making them the largest contributor to total inflows.
- Treasury bills redemptions are expected to rise to N1.05 trillion, compared to N722.72 billion in April, further boosting liquidity.
- FAAC inflows are estimated at N1.8 trillion, slightly below April’s N2.04 trillion but still a significant source of system liquidity.
- FGN bond coupon payments are projected at N346.14 billion, lower than April’s N357.61 billion, with no bond maturities scheduled for the month.
Despite the absence of bond maturities, coupon payments will continue to provide steady liquidity, particularly to institutional investors such as pension funds and asset managers.
More insights
Beyond sovereign instruments, corporate debt market activities are expected to contribute to the liquidity expansion in May. The re-emergence of corporate maturities and increased coupon payments indicates a more active servicing calendar within the segment.
- Corporate bond coupon payments are projected at N95.09 billion, significantly higher than N19.92 billion recorded in April.
- Corporate bond maturities, absent in April, are expected to contribute N10.45 billion to total inflows in May.
- Commercial paper maturities are forecast at N59.50 billion, largely unchanged from N61.61 billion in April.
Although relatively small compared to sovereign inflows, these corporate-related payments will add to overall system liquidity and may drive reinvestment into higher-yield instruments within the corporate debt market.
What you should know
The April 2026 liquidity environment provides important context for the projected increase in May, as it already reflected strong inflows driven by similar instruments. This trend underscores the continued reliance on OMO bills and Treasury instruments as key liquidity drivers.
- FMDA projected N8.84 trillion in inflows for April, with actual inflows reaching N9.08 trillion.
- OMO maturities accounted for the bulk of April inflows at N5.88 trillion, highlighting their dominant role.
- Treasury bills maturities contributed N722.72 billion, while FAAC disbursements stood at N2.04 trillion.
- Additional support came from bond coupon payments and commercial paper maturities, sustaining liquidity conditions.
The sustained increase in inflows into May suggests a continuation of strong liquidity conditions, which could influence yield compression, portfolio rebalancing, and broader fixed income market dynamics.
