CBN to Open N700bn in Treasury Bills for Subscription, Rates to Stay Elevated
The Central Bank of Nigeria (CBN) is scheduled to hold a primary market auction on Wednesday, at which N700 billion in treasury bills will be offered for subscription, the authority announced in a circular.
The total offer is split across standard tenors – 91-, 182-, and 364-day Treasury bills, which have been attracting higher spot rates, boosting demand in recent past auctions.
The CBN will offer N100 billion in 91-day Treasury bills for investors to subscribe, along with an additional N100 billion in 182-day maturities.
The authority is issuing N500 billion in short-term borrowing instruments for investors with a preference for long durations. The CBN would be part-refinancing expired treasury bills worth N269.360 billion across standard tenors.
The market anticipates demand to remain strong due to robust liquidity levels in the financial system. At the previous auction, the market saw spot rates upward repricing even with substantial subscription levels.
Investors continue to demand higher yields in the debt market to compensate for accelerating headline inflation, which has reduced returns on invested capital in the treasury bills space.
Inflation surged to 15.93% while the monetary policy kept interest rates unchanged at 26.5%.
At the last auction conducted in June 2026, a total of N129.32 billion in 91-day bills was sold to investors at a spot rate of 16.28%, up from 16.05% at the previous auction.
At the mid-tenor, 182-day treasury bills subscription printed at N70.22 billion, reflecting low appetite, significantly below the N100 billion offered at the auction. The CBN allocated N70.17 billion to investors at the rate of 16.50%, up from 16.19% at the previous auction.
One-year bills attracted N1.663 trillion in subscriptions from banks and other asset managers seeking to lock down yield for longer-tenor investments. The authority allotted N1.291 trillion at the rate of 17.34%, up from 16.35%.
Given the pattern, Fixed income market analysts expect the 364-day bill to again be the most contested, likely printing a rate somewhat above 17.34% if the trend holds, while the 182-day tenor may again underperform its offer size unless pricing is sweetened enough to draw mid-tenor demand.
In the secondary market last week, trading activity on Nigerian Treasury bills remained relatively subdued, as sell-side pressure across short- and medium-term maturities pushed the average Treasury bill yield up 6 bps to 18.65%. Nigerian Government Raises N19trn from T-Bills, Bonds in 6 Months
