Nigerian Treasury Bills Rally after Midweek Rates Swing
The Nigerian Treasury bills rallied in the secondary market after the Central Bank of Nigeria (CBN) made a slight adjustment to spot rates at the midweek auction.
Trading activities at the secondary market ended on a bullish note on Thursday, with average yields at the mid and long segments of the curve declining by 4bps and 3bps, respectively.
Yields contracted as lost bids at the midweek auction filtered into the secondary market. The market recorded buying interest in Nigerian Treasury bills with maturities of 25-MAR (-31 bps), 5-NOV (-15 bps), and 3-DEC (-13 bps).
As a result, the average yield contracted by 3bps to 17.46%. Traders reported that yields edged lower on select maturities amid steady investor demand and balanced liquidity conditions.
The short end remained largely stable, while slight yield compressions were recorded across the mid-to-long tenors, with only a few papers printing marginal upticks.
Fixed income market analysts anticipate that investor activity will align with prevailing liquidity conditions, with keen interest in the 1-year paper.
The result of the midweek auction showed significant demand of about N2 trillion, with less than half of the subscriptions allotted to investors. The spot rates were adjusted at the short and long ends of the curve, but the authority kept the rate for 182-day Nigerian Treasury bills. NOFR Steadies at 22% Amidst Financial System Liquidity Swings
