CBN to Open N1trn Treasury Bills for Subscription on Wednesday
The Central Bank of Nigeria (CBN) is set to auction N1 trillion in Nigerian Treasury bills on Wednesday, according to the June auction circular.
The total offer size is split across standard tenors: 91-day, 182-day, and 364-day Treasury bills. The CBN is targeting N100 billion each from 91- and 182-day tenors of Treasury bills. However, the authority is placing N800 billion worth of 36days bills on the table for subscription.
With sizeable liquidity level in the financial system, analysts anticipated investors would oversubscribe the midweek auction, citing historical pattern.
Broadstreet analysts admit there is no consensus on spot rate expectations. In its pre-auction note, AAG Capital Limited anticipates a 16.04-16.24% cut-off rate for 91-day bills.
The investment firm set cut-off rates for 182-day Treasury bills at 16.19 – 16.39% and 16.44 – 16.64% for one-year paper. At the previous auction, the authority increased the spot rate on Nigerian Treasury bills with 91 days’ maturity to 16.050% from 15.950%.
The CBN also hiked the spot rate on 182-day bills to 16.19% from 16.14%, while the rate on 364-day bills was pushed to 16.35% from 16.149%. CBN Raises N3.8trn in OMO Bills Sales to Banks, FPIs
