Treasury Bills Yield Expands amidst Improved System Liquidity

Treasury Bills Yield Expands amidst Improved System Liquidity

Treasury Bills recorded 11 basis points increase on Tuesday after persistent decline recorded in recent times amidst inflow from maturing bills, keeping liquidity level in the financial system stronger.

Meanwhile, the recorded improvement liquidity supported by inflow from maturing fixed interest instruments slowdown pressures on interbank rates. An inflow of N157.27 billion into the financial system on Tuesday resulted in 175 basis points drop in overnight lending rate to 15.8%, according to data from FMDQ.

Also, the open buy back sees a 200 basis points drop to 15.5% the same date ahead of the Central Bank primary market auction.

In the foreign currency segment, Naira appreciates against the United States dollar to close at N411 at the investors and exporters foreign exchange window. Market data shows that total dollar volume traded settled at $77.46 million.

Meanwhile, the local currency depreciated by 0.2% to N521.00 per dollar at the parallel market.

Cordros Capital said in a market report that the Nigerian Treasury bill secondary market closed with bearish sentiments, as the average yield expanded by 11 basis points to 4.8%.

Across the benchmark curve, average yield stretched at the long (+25bps) end as investors sold off the 261 -day to maturity bills which gained 89 basis points, but stayed flat at the short and mid segments.

Elsewhere, the average yield at the open market operations (OMO) segment remains unchanged at 6.0%. At the bond market, analysts said trading in the secondary market was bullish.

The average yield on bonds tapered 17 basis points to 11.1%.

Cordros Capital said in the report that average yield across the benchmark curve contracted at the short (-36bps), mid (-12bps) and long (-6bps) segments following investors’ demand for the JAN-2026 (-67bps), MAR-2027 (-31bps) and MAR-2035 (-32bps) bonds, respectively.

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Treasury Bills Yield Expands amidst Improved System Liquidity