T-Bills Yield Edges Higher to 4.51% Ahead of CBN Auction
The average yield on Nigerian Treasury bills edges higher a basis point to 4.51% on Tuesday ahead of the Central Bank (CBN) primary market auction schedule for tomorrow.
According to the auction calendar, the Central Bank will conduct a primary Market auction to roll over Nigerian Treasury bills maturities worth ₦15.03 billion across 91-day (₦4.94 billion) and 182-day (₦10.09 billion) tenors.
Analysts have predicted that subscription will be robust given better financial system liquidity. Today, data from FMDQ Exchange shows that there was pressure on short term interest rates. The average interbank rate jumped 38 basis points.
The Overnight (O/N) rate increased by 0.50 per cent to close at 16.25 per cent as against the last close of 15.75 per cent, and the Open Buy Back (OBB) rate increased by 0.25 per cent to close at 15.75 per cent compared to 15.50 per cent on the previous day.
Despite open market operations (OMO) repayment of ₦50.00 billion, the money market rates are likely to remain at current levels in the near term, FSHD Capital said in a note.
Trading activities in the Nigerian Treasury Bills secondary market closed with average yield across the curve increasing by 1 basis point to close at 4.51 per cent from 4.50 per cent on the previous day.
Analysts said in their separate notes that average yield across the long-term maturities expanded by 1 basis point. However, the average yields across short-term and medium-term maturities remained unchanged at 3.52 per cent and 3.74 per cent, respectively.
NTB 27-Oct-22 (+32 bps) maturity bill witnessed selling pressure, while yields on 21 days to maturity bills remained unchanged, FSDH Capital note shows.
In the OMO bills market, the average yield across the curve decreased by 3 basis points to close at 5.45 per cent, according to Cordros Capital, as against the last close of 5.48 per cent.
FSDH Capital said average yields across medium-term and long-term maturities declined by 25 basis points and 7 basis points, respectively. However, the average yield across the short-term maturities closed flat at 5.35 per cent.
Yields on 7 days to maturity bills compressed with the 22-Feb-22 maturity bill recording the highest yield decrease of 28 basis points, while yields on 3 bills remained unchanged.
In the bond market, FGN bonds secondary market closed bullish as the average bond yield across the curve cleared lower by 1 basis point to close at 8.04 per cent from 8.05 per cent on the previous day.
Average yields across short tenor and medium tenor of the curve decreased by 1 basis point and 4 basis points, respectively. However, the average yield across the long tenor of the curve increased by 1 basis point.
The 22-JAN-2026 maturity bond was the best performer with a decrease in the yield of 41 basis points, while the 18-JUL-2034 maturity bond was the worst performer with an increase in yield of 22 basis points.
Furthermore, FSDH Capital maintains that the secondary bond market is likely to remain subdued in the short term. # T-Bills Yield Edges Higher to 4.51% Ahead of CBN Auction
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