Nigerian T-Bills Yield Surges to 18.61% Amidst Disinflation
The average yield on Nigerian Treasury bills increased as investors trimmed positions in the secondary market amid sustained deceleration in inflation.
Selloffs were predominantly at the short (+24bps) and long (+4bps) ends of the curve, particularly on the 8-OCT (+73bps), 15-OCT (+63bps) and 22-OCT (+51bps) papers, CardinalStone Securities Limited said.
This means that Nigerian Treasury bills with an October maturity were sold off, causing their associated yields to increase by 73 basis points. The bill maturing on October 15 was also offloaded, with its yield climbing 63 basis points, and the Oct 22 paper saw a 51-basis-point yield surge.
The consumer price index report indicates that the headline inflation rate moderated to 15.43% in July, down from 15.91% reported in June 2026.
This marked the second consecutive retreat in the consumer price index, widening the real return on investment to 11.07% as a 26.5% monetary policy rate chases 15.43% inflation.
Fixed income market analysts told MarketForces Africa that there was selective demand, supported by ample liquidity in the financial system, as bond returns came under further pressure.
Traders noted that, although robust liquidity supported demand in select maturities, this was offset by sell-offs elsewhere, resulting in a modest upward repricing of the curve. The newly issued 12-Aug-2027 bill closed at 17.40%/17.25%, AIICO Capital Limited said in a note to investors.
Meanwhile, in the OMO segment, the actively traded 29-Dec bill closed at 19.65%/19.45% as investors locked in attractive yields.
Several investment banking firms reported that the average benchmark yield on Nigerian Treasury bills edged up 8 bps to close at 18.61%.
Both the equities and debt markets traded lower, even as headline inflation pressures eased. MarketForces Africa reported that investors began weighing investment options after the Central Bank lifted restrictions on OMO bills—the highest-yielding short-term financial instrument.
