OMO, Treasury Bills Yields Increase Ahead of Rate Decision
The average yield on Nigerian Treasury bills printed at 16.96% in the secondary market as investors slowed down trading activities ahead of Broadstreet’s expectations of an interest rate adjustment.
Nigerian OMO bills’ yield was well priced, higher at 21.5%, to retain foreign portfolio investors seeking alpha on naira assets. On Monday, OMO and Nigerian Treasury bill yields rose at the secondary market as investors’ appetite for the naira assets reduced as the market awaits the monetary policy committee (MPC) decision on interest rate.
Transaction closed negative with soft selloffs seen at the long end of the curve as pre-MPC decision market sentiments triggered cautious positioning. Investors’ preference for higher yields drove increases across the mid- to long-tenor bills. On the short end, the 5-Feb-2026 bill saw a mild 22bps decline, closing at 15.51%.
After series of OMO actions last week, investors started to trim their positions in the secondary market, causing the average yield to surge by six basis points to 21.5%.
Traders reported that bearish sentiments prevailed at the long-end (+10bps), which opposed buying interests at the short (-5bps) and mid-segment (-6bps) of the curve. Average yield on Nigerian Treasury bills inched up 1bp to settle at 16.96%
Across the curve, the average yield contracted at the short (-5bps) and mid (-6bps) segments, Cordros Capital Limited said in a report. The yield contraction was driven by the demand. Investors positioned in 73-day treasury bills paper and 122 days bills, respectively.
Yield at the long end of the curve expanded by 10 bps due to profit-taking activities on the 346 days to maturity bill. Similarly, the average yield expanded by 6bps to 21.5% in the OMO segment.
