Investors Exit Position in Nigerian Treasury Bills Ahead of Inflation
The average yield on Nigerian Treasury bills climbed by four basis points to 17.94% in the secondary market as investors exited positions ahead of inflation data.The market anticipates that July inflation will ease as the naira exchange rate volatility reduced sharply in July, along with the food price index.
In a note, analysts at Coronation Merchant Bank’s research unit anticipate that the headline inflation rate will ease to 21.52% year-on-year, down from 22.22% year-on-year in June, underpinned by the pass-through effect of Nigeria’s FX policy reforms continuing to support Naira stability.
Fixed income market analysts said the T-bills market traded with a bearish tone, with sell-offs witnessed at the 20-Nov (+91 bps), 18-Jun (+81 bps), and 9-July (+46 bps) papers. The risk-off sentiment-driven trading pattern, however, masked buying interest at the 11-Dec (-43 bps) and 18-Dec (-32 bps) instruments.
As a result, average yield expanded by 4 bps to close at 17.94%. The market opened mixed with a mild sell bias as system liquidity turned negative. Yields on the short end of the curve advanced, while movements were mixed at the mid and long ends.
Notably, the 04 Dec 2025 and 08 Jan 2026 papers rose by 11 bps and 3 bps. Respectively, yields on Nigerian Treasury bills maturing on 05 Mar 2026 and 09 Apr 2026 declined by 18 bps and 8 bps, respectively.
Trading activity to align with the available liquidity with the expectation that banks could exit more positions to shore up funding demand in the absence of significant inflows to support the financial system conditions.
CardinalStone Securities Limited reported that yields in the global spectrum closed July with a bearish tilt. The month saw yields trend upwards as tariff impacts began to reflect on rising CPI data for most developed markets. US CPI printed higher at 2.7%, extending fears for a longer delay in rate cut actions by the US FED.
Despite the growth recovery in Q2’25, yields on the US 10YR benchmark instrument still closed 15bps higher to settle at 4.37%. This reflected shifting sentiments, especially after the Bureau of Labor Statistics (BLS) revised its May and June employment figures lower and reported that only 73,000 jobs were added in July. The unemployment rate also edged up to 4.2%, further complicating the monetary policy outlook.
Outside the US, the UK and EU yield curves steepened, driven by sharper increases at the long end. In the UK, evidence of a softening labor market, including an uptick in the unemployment rate to 4.7%, weighed on sentiment.
Meanwhile, the EU faced headwinds from widening fiscal deficits, tax disputes, and political uncertainty in Southern Europe, which overshadowed fiscal stimulus announcements, especially in Germany, aimed at bolstering infrastructure, defence, and the energy transition to renewables. #Investors Exit Position in Nigerian Treasury Bills Ahead of Inflation Nigeria Non-Oil Exports Hit $3.225bn in Half-Year 2025 – NEPC DG
