Nigerian Treasury Bills Yield Dips, Excess Liquidity Fuels Rally
The average yield on Nigerian government Treasury bills declined in the secondary market as buying momentum persisted via secondary market transactions.
The yield contracted as excess funds in the banking system fuelled bargain hunting in the treasury bills secondary market ahead of Q4 issuances by the authority.
Traders reported that investors were locking down yield on the expectation that the Central Bank of Nigeria (CBN) will reprice spot rates at the upcoming primary market auction.
The recent interest rate cut is expected to impact how much the authority is willing to pay on the short term borrowing instruments.
The lower spot rate expectation is also fuel by robust liquidity in the money market as well as disinflation condition. On Monday, Treasury bill market opened the week on a bullish sentiment, supported by widespread buying across maturities.
Rates fell notably on the 05 Feb 2026 and 19 Feb 2026 bills, declining by 95bps and 22bps to close at 16.55% and 16.52%, respectively.
Overall, the benchmark Nigerian Treasury Bills yield dropped, declined by 13 basis points to 17.8%, according to Cordros Securities Limited.
Fixed income market analysts reported that across the curve, the average yield expanded at the short (+3bps) end, driven by profit-taking activities on the 73 days to maturity (+30bps) bill.
However, yield contracted at the mid (-42bps) and long (-3bps) segments of the curve due to the demand for the 157 –day to maturity (-122bps) and 346 days to maturity (-3bps) bills, respectively.
