Interest Rate on Treasury Bills Falls by 57bps at CBN Auction
The discount rate on Nigerian Treasury bills reduced in the primary market conducted by the Debt Management Office (DMO) on behalf of the monetary authority as demand spiked on Wednesday.
The auction recorded significant interest in a one-year bill while bids for short and mid-tenor Treasury paper ebbed. At the auction, the DMO offered N583.25 billion across standard maturities to investors seeking risk-free investment.
The result of the auction showed that investors have a strong appetite for naira assets as reflected in the total subscription of N2.55 trillion put forward across the 91-day bill, 182-day bills, and 364-day on offer.
The breakdown showed that as much as 99% of the aggregate subscriptions from market participants was for the 364-day with bid-to-cover ratio of 4.37x,
This was significantly above 1.93x recorded at the previous auction. At the end, the Debt Office allotted N756.70 billion to investors across standard maturities, significantly above the actual offer of N538.25 billion.
The auction saw 364-day paper receiving 98% of the total allotment. Stop rates printed lower by 57 basis points for the 364-day paper, from 23.50% to 22.97%.
Maintaining status qua on the short and mid end , spot rates remained unchanged for the 91 and 182-day papers at the end of the primary market auction. #Interest Rate on Treasury Bills Falls by 57bps at CBN Auction
