Nigerian Treasury Bills Yield Falls Ahead of Midweek Auction
In the secondary market, the average yield on Nigerian Treasury bills declined to about 21% ahead of the Central Bank of Nigeria (CBN) primary market auction (PMA) on Wednesday.
Investors still showed preference for the naira assets amidst spot rates fluctuation and widening real return gap post-disinflation. On Tuesday, The Treasury bills yield curve shifted in the secondary market following an improved demand for the naira assets ahead of the midweek auction.
Trading activity tightened, though some interest was noted in the March and April papers, causing a 10 basis point decline in average yield, which closed at 20.93% in the secondary market.
The Apex Bank is scheduled to hold a primary auction for N550 billion worth of Treasury bills as part of liquidity management efforts. The authority’s latest fast and furious and yet sizeable OMO bill auctions have already impacted liquidity levels in the financial system.
Traders opened the day bearish on Nigerian Treasury bills following the OMO auction announcement. Treasury bills holders tried to offload more positions ahead of the midweek issuance, but buyer interest stayed muted.
Across the curve, the average yield contracted at the short (-1bp), mid (-1bp) and long (-18bps) segments, according to Cordros Capital Limited. The yield contrasted due to demand for the 16-day to maturity (-2bps), 170-day to maturity (-1bp) and 247-day to maturity (-106bps) bills, respectively.
Conversely, the average yield expanded by 2 bps to 27.0% in the OMO segment. #Nigerian Treasury Bills Yield Falls Ahead of Midweek Auction# United Capital Grows Profit by 64% to N5.89bn in Q1
