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Short, long-term bonds interest spreads narrow on lower risks
Interest rates on the short-term bills and bonds are expected to drop further with CBK widely seen cutting its benchmark lending rate further, beginning at its October 8 meeting.
The difference in the interest rates on long- and short-term bonds has narrowed significantly in the past month, raising prospects of a normal yield curve on government bonds.
A yield curve is considered 'normal' because the market usually expects more compensation for greater risk in longer-term investments.
