Nigerian T-Bills Yield Slides to 17.40% Ahead of Inflation
Ahead of inflation, the average yield on Nigerian Treasury bills declined by 3 basis points (bps) in the secondary market to 17.40% on Monday, traders said in a note.
The National Bureau of Statistics (NBS) is expected to release the consumer price index (CPI) this week, with a mixed outlook compared to pre-Middle East war levels.
Due to sustained interest in the naira’s curve, the Treasury bills market saw demand across the short and belly of the curve amid sustained downward adjustments in spot rates.
The past two primary market auctions for Nigerian Treasury bills conducted by the central bank signalled deliberate downward adjustments in the spot rate across the mid- and long-term tenors.
The rejected funds from the primary subscription filtered into the secondary market. The secondary opened the week positively, with the average yield moderating by 3bps to 17.40%.
Reflecting carry over from last week, buying interest was observed across the yield curve, with each maturity recording a 2-3 bps decrease in yield.
Nigerian bills with Apr-2027 maturity date saw the strongest demand pressure, as yield declined by 9bps, traders said in a note.
Broadstreet analysts’ expectations for Nigeria’s headline inflation shifted, with estimates suggesting the consumer price index could reverse its downtrend amid higher oil prices.
The US-Iran war is affecting oil prices, and Nigeria is not immune despite being one of Africa’s top oil producers. This has roughened initial disinflation expectations.
In the US, the 10-year Treasury yield rose by 2.0 bps to 4.34%, as markets balanced improving risk sentiment against strong macroeconomic data, particularly labour market resilience, which continues to support a higher-for-longer rate narrative Stanbic IBTC Hits 52-Week High on Sharp Intraday Rally
