Nigerian Treasury Bills Yield Falls to 21% Ahead of Inflation
The average yield on Nigerian Treasury bills fell to 21% in the secondary market due to continued positioning on the naira assets ahead of inflation data. Disinflation, which has reduced real return on investment, is unable to deter investors’ appetite for the Nigerian bills, with mixed expectations over the next monetary policy action on the benchmark interest rate.
Traders were active in the market on Monday, resulting in demand for bills across the belly and long end of the curve. Preference for short duration appeared to have reduced on expectations that the rebased inflation data would reverse the trend seen in March.
Hence, the average yield contracted by 2 bps to 21.0%. Traders reported that the average yield contracted at the short (-3 bps) and mid (-3 bps) segments. The yield contraction was buoyed by the demand for the 10-day to maturity (-4bps) and 178-day to maturity (-3 bps) bills, respectively. The yield on Nigerian Treasury bills closed flat at the long end.
While activity remained subdued overall, selective demand emerged at the long end of the curve, though limited by sparse offerings. The short and long ends of the curve also saw a decrease of 7 bps to close at 18.83% and 11 bps to close at 22.79%, respectively.
Meanwhile, the medium segment of the curve saw an increase of 14 bps to close at 19.70%. Similarly, the average yield contracted by a basis point to close at 26.9% in the OMO bills segment in the secondary market. First Holdco Profit Plunges by 18% in Q1-2025
