Nigeria’s economy recorded real GDP growth of 3.89% year-on-year in the first quarter of 2026, an improvement from the 3.13% recorded in the corresponding period of 2025, according to fresh data released by the National Bureau of Statistics. Agriculture emerged as the most improved sector, growing by 3.15% in Q1 2026, a significant rebound from the marginal 0.07% growth recorded in Q1 2025. The Information and Communication sector was among the strongest performers, expanding by 10.98% in real terms and contributing 11.31% to total GDP, while the Finance and Insurance sector grew by 8.54% and Construction expanded by 6.38%. The non-oil sector remained dominant, contributing 96.08% to total GDP, while average daily oil production declined to 1.55 million barrels per day from 1.62 million barrels in the same period of 2025. In nominal terms, aggregate GDP rose to ₦110.79 trillion from ₦94.05 trillion in Q1 2025, reflecting nominal growth of 17.79%. The results signal a strengthening of Nigeria’s economic reform momentum, even as the CBN holds rates steady amid inflationary pressures and will likely support the World Bank’s upgraded growth forecast of 4.4% for Nigeria in 2026.
Money Market
System liquidity saw an increasing trend throughout the trading week, opening at ₦3.84 trillion on Monday, and closing at ₦6.01 trillion. Week-on-week, the Open Buy Back (OBB) held steady to close at 22.00%, likewise, the Overnight (OVN) rates decline by 5bps to close at 22.19%.
We expect rate to continue to hover around this level.
Treasury Bills Market
The Treasury Bills market traded on a mildly bullish note throughout the week, with activity concentrated around the long end of the curve as investors cautiously navigated the liquidity management operations by the CBN. Early in the week, the 20-May bill was quoted around 16.10%/16.00% range. Market sentiment was further shaped by the OMO auction where the Apex bank offered ₦600bn across the 11-day. 39-day and 102-day. The auction recorded robust demand, with subscriptions printing at ₦2.50trn, although only ₦1.90trn was allotted across the 11-day and 102-day paper, with stop rates of 21.80% and 20.37% respectively, with no sale recorded for the 39-day paper. By week-end, the 20-May bill quoted around 16.05%/15.90% as investors adopted a cautious stance. Looking ahead, market focus will shift to the upcoming NTB auction, where the DMO is expected to offer ₦700bn across the standard tenors. Week-on-week, the average benchmark yield declined by 5bp to close at 17.48%.
We expect a relatively active week ahead of the upcoming NTB auction
FGN Bond Market
The FGN bond market traded on a quiet note during the week. At the start of the week, activity remained subdued with the 2035 and 2037 maturities trading at 17.15%/17.00% and 17.10%/17.00% respectively, reflecting weak investor appetite. Consequently, benchmark yields trended higher during the week, while activity remained relatively thin as market participants continued to source for higher yields. By week-end, the 2037 maturity traded around 17.08%/16.95%, reflecting the sustained bearish bias across the bond market. Week-on-week, the average benchmark yield increased by 3bps to close at 16.02%.
We expect yield to continue to hover around similar range as interest remains subdued.
FGN Eurobond Market
The Eurobond market experienced a volatile week, with sentiment largely driven by developments surrounding the U.S.-Iran peace negotiations and broader geopolitical tensions in the Strait of Hormuz. The week opened cautiously following the U.S. Memorial Day and UK bank holidays, though early optimism was supported by comments from U.S. Secretary of State Marco Rubio, who described a solid framework deal on the table for reopening the Strait, while warning of military action should Tehran reject the proposal. As the week progressed, Rubio reinforced the positive tone, speaking from New Delhi and reassuring markets that diplomacy would be given every chance to succeed, describing a very real, significant, time-limited negotiation on the nuclear matter alongside the shipping deal. President Trump also said that talks were going nicely while maintaining his position that it would be a Great Deal for all, or no Deal at all. However, optimism was repeatedly tested as the U.S. carried out fresh military strikes on Iran during the week, keeping markets on edge. The mood shifted more decisively toward the end of the week, as reports emerged that the U.S. and Iran had reached a tentative agreement to extend a 60-day ceasefire and allow shipping through the Strait of Hormuz, though the proposal still awaits formal approval from President Trump and confirmation from Tehran. Week-on-Week, the average benchmark yield declined by 16bps to close at 6.76%.
We expect market direction to be driven by evolving geopolitical developments, PMI, and NFP data.
Currency Market
The value of the Naira to the dollar appreciated by 0.15% week on week to close at ₦1,373.25/$ at the Nigerian Foreign Exchange Market Window (NFEM).
Equities Market
The local bourse ended the day with the benchmark NGX All-Share Index (ASI) appreciating by 0.27% to reach 250,385.70 points while market capitalisation increased marginally to close at N160.0 trillion. Market breadth was negative at 0.91x. Trading activity was active on the day, with the volume of shares traded decreasing by 29.67% to 731.4 million units, while total value of shares traded increased by 28.13% to ₦34.9 billion.
Reflecting the week’s performance, the NGX All-Share Index appreciated by 0.57%, as gains in INTENEGINS (+32.55%), SOVRENINS (+20.61%), and TANTALIZER (+18.40%) were offset by declines in DANGSUGAR (-18.22%), TIP (-15.98%), and CAP (-10.00%).
Overall, the NGX has posted a year-to-date gain of 60.90%. Other notable indices are the NGX Top 30 Index (0.24%; +0.53% 1WK; +60.08% YTD), NGX Banking Index (0.69%; -2.18% 1WK; +55.57% YTD), NGX Oil & Gas Index (4.53%; 2.72% 1WK; +123.94% YTD), and NGX Insurance Index (2.30%; -1.23% 1WK; 6.20% YTD).
