Nigerian Treasury Bills Yield Surges to 20.4%
The average on Nigerian Treasury bills increased in the secondary market as investors continued to dump the short term borrowing instruments. Investors’ moods swung due to sustained spot rates decline at the primary market.
With the inflation rate slowing down, the authority has continued to hacked rates down amidst growing public debt. Disinflation has boosted real return on investment and allowed it to maintain that the consumer price index dropped further in the year.
In the fixed income market on Tuesday, the average yield on Nigerian Treasury bills dropped further. The bearish sentiments in the secondary nudged the average yield on the asset higher by 8 basis points to 20.4%, according to traders.
Traders said they saw buying momentum across the curve, which then caused the average yield to decline at the short (-4bps) end due to demand for the 79-day to maturity (-4bps).
Meanwhile, the average yield expanded at the mid (+8 bps) and long (+16 bps) segments, according to Cordros Capital Limited. The yield surge was driven by profit taking activities on the 156-day to maturity bills, which shed +83 bps.
Selloffs on 247-day to maturity raised its associated yield higher by +245 bps. Similarly, the average yield expanded by 2 basis points to 23.7% in the OMO bills segment. #Nigerian Treasury Bills Yield Surges to 20.4% NGX Gains Weight as Investors Wealth Rises by N120bn
