CBN Returns N1.2trn from OMO, TBills Bids, Cuts Rates
Nigeria’s attractive short-term investment options continue to attract local and foreign investors into the financial market. Institutional investors, local banks, and asset managers’ appetite for fixed income assets maintained an uptrend even as spot rates began to decline.
In its latest primary market auctions, the Central Bank of Nigeria (CBN) raised more than N2.5 trillion in consecutive days. Details from the OMO bills and Treasury bills auction conducted on Wednesday and Thursday showed more than N1.2 trillion in investment money were rejected by the apex bank.
For Treasury bills, the CBN offered N650 billion across standard maturities, a competitive bids that saw a total rejection settling at more than N1 trillion on Wednesday. The midweek auction recorded ₦1.92 trillion in total subscription amidst excess liquidity reported in the money market before the auction.
Out of this, the CBN allotted ₦830.44 billion in an oversold auction of ₦180.44 billion, exceeding the offer size by 28%. Stop rates for the 182-day and 364-day bills fell by 25 bps and 61bps, to 17.75% and 17.82%, respectively, while the 91-day remained unchanged at 17.00%.
On Thursday, the CBN floated an OMO auction where the monetary authority offered ₦600 billion across two long-dated papers. The OMO bill auction conducted yesterday has local deposit money banks and foreign portfolio investors as eligible players.
Total subscriptions at the OMO bills reached ₦1.877 trillion, and allotments totaling ₦1.677 trillion were made to eligible market participants.
Stop rates for the 2 tenors settled at 19.19% and 19.45%, respectively. Traders said the CBN rejected N200 billion out of the amount received as a subscription for the OMO auction. #CBN Returns N1.2trn from OMO, TBills Bids, Cuts Rates Real Return Positive as Interest Rate Exceeds Inflation in Nigeria
