CBN Begins Q4 Auction, Opens N900bn Treasury Bills for Sale
The Central Bank of Nigeria (CBN) is scheduled to conduct its first Treasury Bills auction of the quarter on Wednesday, aiming to raise N900 billion across maturities.
The Debt Management Office (DMO) will conduct the primary market auction for the Treasury bills on behalf of the monetary authority, offering N1Fixed-income91-day, 182-day (N100bn) and 364-day (N700bn)
Fixed-income market analysts expect the Nigerian Treasury auction to attract strong subscriptions that will exceed the offer size, reflecting sustained demand for naira assets.
Due to sustained appetite for long-duration naira assets, the market anticipates 364-day Nigerian Treasury bills to attract most of the investors’ bids or subscriptions on Wednesday.
However, AAG Capital Limited said recent investor apathy in the bond market is expected to weigh on demand at the midweek auction.
The firm anticipates that this could push the bid-to-offer ratio for the 1-year paper below 16%, potentially raising the stop rate, barring any issuance adjustments by the DMO post-bid submission.
At the last auction in Q3, the CBN sold 91-day Treasury bills worth N11.03 billion at the spot rate of 15.50%. The authority allotted N39.49 billion in 182-day bills at 15.80%, and sold one-year paper worth N447.07 billion to investors at 15.89%.
