Dealers predict N10.53trn liquidity surge for May

The Financial Markets Dealers Association (FMDA) has predicted that liquidity in Nigeria’s fixed-income market may hit N10.53 trillion.

This anticipated surge represents a notable increase from the N9.08 trillion recorded in April, signaling a high-liquidity environment that could significantly impact interest rate movements and investment strategies across the financial sector.

According to the FMDA Monthly Market Report released on May 5, 2026, the primary catalyst for this liquidity expansion is a heavy cycle of Open Market Operations (OMO) maturities.

These maturities are expected to hit N7.17 trillion, rising sharply from the N5.88 trillion observed in the previous month.

This dominant volume is further supported by Treasury bill redemptions, which are forecast to grow to N1.05 trillion, and Federal Account Allocation Committee (FAAC) disbursements estimated at N1.8 trillion. Even though there are no sovereign bond maturities scheduled for May, institutional investors like pension funds will still see steady cash flow from FGN bond coupon payments totaling N346.14 billion.

The corporate debt segment is also poised to play a more active role in the market’s liquidity profile this month.

In a significant shift from April, corporate bond coupon payments are expected to soar to N95.09 billion, while corporate bond maturities will re-emerge to contribute N10.45 billion to the system. Commercial paper redemptions are projected to remain relatively stable at N59.50 billion.

While these corporate-related inflows are smaller in scale compared to government instruments, their increased volume suggests a more robust servicing calendar and offers fresh opportunities for reinvestment into higher-yield corporate assets.

The transition from April’s actual inflows to the higher projections for May underscores a persistent reliance on OMO and Treasury instruments as the bedrock of Nigerian market liquidity.

This sustained influx of capital creates a landscape where yield compression and widespread portfolio rebalancing become likely.

As investors and fund managers look to deploy this massive volume of matured capital, the resulting market dynamics will likely define the trajectory of Nigeria’s fixed-income landscape through the mid-year period.