Business

Tight monetary policy threatens FG’s N720bn borrowing plan

Published

4 years ago

August 8, 2022

Governor of the Central Bank of Nigeria, Godwin Emefiele

The Federal Government’s plan to borrow about N720 billion through FGN bond auctions in the third quarter, Q3’22, has come under fresh threat following increasing investors’ appetite for higher yields triggered by the adoption of tight monetary policy of the Central Bank of Nigeria, CBN.

Recall that the CBN, in response to the five consecutive months rise in inflation rate to 18.6 per cent in June, launched a tight monetary policy regime May, 2022, raising the Monetary Policy Rate, MPR, first by 150 basis points to 13 per cent in May and again by 100 basis points to 14 per cent in July.

This development effectively spurred increases in money market yields while intensifying investors’ appetite for higher returns across all instruments in all segments of the market.

Consequently, the first under-subscription was recorded in FGN bond auction this year, as the auction held in July recorded 37 per cent under subscription and as a result, Debt Management Office, DMO could not achieve its sales target.

According to the FGN bond auction calendar for Q3’22 released by the Debt Management Office, DMO, the FG plans to raise between N630 billion and N720 billion during the quarter.

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The calendar shows that the FG, through the DMO, seeks to raise between N210 billion and N240 billion in each of the three months in the quarter, through subscription in three tranches of 10-year, 10-year, and 20-year original tenor respectively.

But the N225 billion FGN bond offered by the DMO at the July auction recorded 37 per cent under subscription as total subscription stood at N142 billion.

Though the 20-year bond, 13.00% FGN JAN 2042, recorded 40 over subscription, as subscription stood at for N104.92 as against N75 billion offered by the DMO, the 3-years 13.53% FGN MAR 2025 and 10-years 12.50% FGN APR 2032, recorded 84 per cent and 66 per cent under subscription respectively, as subscriptions stood at N11.75 billion and N25.62 billion respectively as against N75 billion offered for each bon tenor.

Consequently, the DMO could only achieve total sales of N123.9 billion, representing 45 per cent of its target for the month.

This was in spite of slight increases in the interest rates on the bonds offered by the DMO.

The auction results showed that the DMO raised the marginal rates for the 3-year, 10-year and 20-year bonds to 11.0 per cent from 10 per cent, 13.0 per cent from 12.5 per cent and 13.7 per cent from 13.2 per cent respectively in the June auction.

Analysts’ insight

Investment analysts however noted that for the DMO to attract investors to future auctions it would have to offer higher rates given the inflation rate of 18.6 per cent and MPR at 14 per cent.

While noting that in spite of the impact of scarcity of funds and increasing appetite triggered by the CBN’s tight monetary policy, on future bond auctions, they expect the DMO to meet its funding target of N3.53 trillion to finance the projected deficit of N7.35 trillion in the FGN’s 2022 budget.

Speaking in this regard, analysts at FBNQuest Securities, associated company in the First Bank Group, said: “The total amount raised by the DMO this year amounts to N1.7 trillion. If we include sales based on non-competitive allotment, the gross amount rises to N1.96 trillion. This excludes smaller sums raised via other instruments including Sukuk and the FGN savings bond.

“Despite the DMO’s disappointing outing, the sum raised so far by the agency suggests that it is broadly on track to raise its total domestic funding target of N3.5 trillion (including the additional borrowings of N965 billion following revisions to the budget).

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“However, the tight liquidity conditions in the market may continue to negatively affect demand at auctions in the near term.

“There are tougher credit conditions on the international market following monetary policy tightening by most central banks globally. This may force the FGN to turn to the domestic market to source some of the N2.6 trillion in external borrowing highlighted in the 2022 budget.

“The last resort would be for the fiscal deficit to become unfunded, or in other words, funded by ways and means advances from the CBN.

“Given the tight liquidity conditions in the market, we see yields inching up by around 25-50bps across the curve over the coming weeks.”

Similarly, analysts at United Capital Plc, associated company in the First Bank Group, said: “In line with our expectations of an uptick in the yield environment in the sovereign bonds market, marginal rates across all the tenors climbed 90bps, 50bps, and 60bps to print at 11.00%, 13.00% and 13.75%, respectively. Investors opted toward a more relaxed approach in the auction, demanding higher yields, as the expectation of inflation, interest rates, and political risks all begin to crystalise. These follow persistent inflation, monetary policy normalisation globally and the increased perception of political risk as we approach the electioneering season.

“We expect a continued uptick in marginal rates at subsequent bond auctions, as we believe investors will remain standoffish. The DMO will need to reel in higher rates to attract fund managers’ interests.

“Also, the recent hawkish stance adopted by the CBN, hiking rates by 250bps in total (100bps at July’s MPC meeting), will drive investor’s appetite for increased rates.

“Notwithstanding, we maintain the FG’s apparent need to rely on the domestic debt market to fund its fiscal imbalance, as external debt market conditions remain unfavourable. These factors will further impetus for shifting pricing power away from the FGN/DMO and into the hands of private sector asset managers.”

Related Topics:Borrowing Featured FG Monetary Policy

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Jetour T1 Storms Abuja as Automaker Accelerates Nigeria Expansion

Published

2 hours ago

September 21, 2026

Trends Admin

Jetour T1 Set to debut in Abuja as Expansion Gains Momentum

Following a successful debut in Lagos, Jetour Nigeria will host the Jetour Experience Abuja from September 22 to 24, 2026, positioning its all-new T1 model as a major competitor in the country’s growing adventure SUV market.

The three-day event in the Federal Capital Territory will give prospective buyers and motoring enthusiasts direct access to product demonstrations, expert-led technical sessions, and hands-on test drives.

“Strong participation, extensive test drives, and significant sales enquiries at the Lagos edition, coupled with growing demand from Abuja residents, influenced the decision to bring the experience to the nation’s capital,” the company said in a statement. The show holds at Maha Event Centre, Area 8, Garki.

To support its growing national footprint, Jetour Nigeria has established a network of seven accredited dealers: Elizade Nigeria Limited, New Era AutoVehicle Services Limited, Kojo Motors, Germaine Auto Centre, Tab Autos Limited, R.T. Briscoe Motors, and Mandilas Autos. The partnerships cover retail sales, genuine spare parts supply, and comprehensive after-sales maintenance.

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The T1 enters the market with a focal point on balance—combining off-road capability with urban comfort.

The smart T1 has the following features-
Dimensions: 4,705mm (L) x 1,967mm (W) x 1,843mm (H) |; Wheelbase: 2,800mm; and
Powertrains: 1.5L Turbo / 2.0L Turbo (254 hp, 390 Nm torque).

The drivetrain is BorgWarner XWD Intelligent 4WD | 7-Speed DCT or 8-Speed Automatic. Terrain Capability: 199mm ground clearance, 600mm wading depth, and 28° approach/departure angles.

Other features include 15.6-inch HD touchscreen, Qualcomm Snapdragon 8155 platform, 8-speaker audio, 5-seater configuration with 574 litres of rear luggage space, 85 percent high-strength steel chassis alongside a Level 2 Advanced Driver Assistance System (ADAS), which includes Adaptive Cruise Control, Lane Keeping Assist, Forward Collision Warning, and Autonomous Emergency Braking.

Since its Nigerian market entry, Jetour has secured several local and international automotive honors, including Fastest Growing Auto Brand of the Year and Auto Brand of the Year.

Jetour T1 Set to debut in Abuja as Expansion Gains Momentum

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Abuja Demand Rises as Jetour Brings X70 Plus Experience to FCT

Published

1 day ago

September 20, 2026

Trends Admin

Abuja Demand Rises as Jetour Brings X70 Plus Experience to FCT

Jetour Nigeria is taking its seven-seater X70 Plus SUV to Abuja as rising interest from motorists in the Federal Capital Territory and neighbouring states fuels the brand’s latest push to deepen its presence across Nigeria.

The X70 Plus will headline the Jetour Experience Abuja, holding from September 22 to 24 at Maha Event Centre, Area 8, Garki, following the strong response recorded during the Lagos edition, where motorists turned out for test drives and made enquiries about Jetour models.

The Abuja activation is designed to give prospective buyers direct access to the X70 Plus and other models, with opportunities to test-drive the vehicles, engage product specialists and experience their technology, safety and comfort features.

The X70 Plus is positioned as a family-oriented SUV, offering seven-seat capacity and a range of features targeted at customers seeking comfort, technology and practicality.

The SUV is available with 1.5-litre and 1.6-litre turbocharged engine options, with outputs of up to 145kW and 290Nm of torque, paired with a dual-clutch automatic transmission.

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Its safety equipment includes front, side and curtain airbags, Vehicle Stability Control, Hill-Start Assist, Hill-Descent Control and a 360-degree panoramic camera with 2D and 3D viewing modes. Advanced Driver-Assistance Systems are also available.

Inside the cabin, the X70 Plus features a 10.23-inch LCD touchscreen, dual-zone climate control with air purification, wireless charging, a panoramic sunroof and an eight-speaker audio system.

Jetour Nigeria, the authorised distributor of the brand in the country, currently operates through seven accredited dealers: Elizade Nigeria Limited, Mandilas Autos, R.T. Briscoe Motors, Germaine Auto Centre, Kojo Motors, Tab Autos Limited and New Era Auto Vehicle Services Limited.

The company said the dealer network supports vehicle sales, genuine spare-parts supply and after-sales services across the country.

Jetour has also received recent industry recognition in Nigeria, including Fastest Growing Auto Brand by the Nigeria Auto Journalists Association and Auto Brand of the Year at the Nigeria Transport Lecture and Awards.

The Abuja experience is expected to provide prospective customers in the FCT and surrounding states with direct access to the X70 Plus and other Jetour models as the brand continues its national market expansion.

Abuja Demand Rises as Jetour Brings X70 Plus Experience to FCT

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Jetour Unleashes F700 Hybrid Pickup as Abuja Experience Begins Tuesday

Published

2 days ago

September 19, 2026

Trends Admin

Jetour Unleashes F700 Hybrid Pickup as Abuja Experience Begins Tuesday

Jetour is taking its premium pickup game to Abuja as the automaker prepares to showcase the powerful F700 hybrid pickup at the Jetour Experience Abuja, bringing a blend of electrified performance, luxury and rugged off-road capability to the Federal Capital Territory.

The three-day event, scheduled for September 22 to 24 at Maha Event Centre, Area 8, Garki, comes on the heels of strong reception in Lagos and is expected to draw commercial fleet operators, corporate buyers and luxury pickup enthusiasts keen to experience Jetour’s latest hybrid workhorse.

Following high-impact reception in Lagos, the Abuja activation, which holds at Maha Event Centre, Area 8, Garki, answers massive demand from commercial fleet leaders, corporate buyers, and luxury truck enthusiasts eager for an electrified workhorse built without compromise.

Jetour’s rapid ascendancy as Nigeria’s Fastest Growing Auto Brand and Auto Brand of the Year is backed by nationwide after-sales infrastructure, certified technicians, and genuine parts availability through its authorized dealer network including Elizade Nigeria Limited, New Era AutoVehicle Services, Germaine Auto Centre, Kojo Motors, Mandilas Autos, R.T. Briscoe and
Tab Autos.

The Ultimate Hybrid Powerhouse
Engineered on the heavy-duty platform of Jetour’s G700 luxury SUV, the double-cab F700 redefines utility.

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Stretching nearly 5.5 meters, it commands road presence via a high-tensile ladder-frame chassis and independent double-wishbone suspension engineered for punishing industrial demands and refined highway cruising alike.

Under the hood lies the revolutionary Kunpeng Super Hybrid CDM-O powertrain—pairing dual high-output electric drive motors with an onboard turbo petrol generator that seamlessly feeds the battery pack on the fly, eliminating range anxiety entirely.

According to Jetour, an advanced CATL 800V architecture surges the battery from 20% to 80% in just 10 minutes, achieving ultra-fast charging.

The vehicle delivers a monumental combined cruising range of up to 1,300 km on a single charge and tank, and achieves exceptional fuel economy, sipping as low as 1.39 L/100 km.

Conquering Terrain in First-Class Luxury
Engineered for unforgiving terrain, the F700 deploys Jetour’s intelligent XWD all-wheel-drive system governed by front, center, and rear mechanical differential locks.

With 9.5 inches of ground clearance and an imposing 900 mm water-wading capability, the F700 glides through deep water crossings, unpaved construction corridors, and rocky trails effortlessly.

Inside, the cabin abandons utilitarian compromises for bespoke executive refinement, featuring
35.4-inch Panoramic “Sky Screen” dominating the dash architecture.

Also, it features the 15.6-inch Central Command Touchscreen for seamless telematics and vehicle dynamics, Sculpted Luxury Finishes combining aviation-grade acoustic insulation, premium materials, and active driver-assist safety suites.

The three-day Jetour Experience Abuja will feature live technical walkarounds, rugged dynamic tests, and hands-on driving trials at the capital.