Treasury Bills Yields Contract on Naira Asset Accumulation
The Nigerian Treasury bills yields declined as investors ramped up naira assets via secondary market transactions on Monday. The market recorded buying interest across standard tenors after the authority repriced Treasury bills with a 364-day maturity at 17.66% in last week’s auction.
The Central Bank of Nigeria (CBN) slightly reduced the spot rate on Nigerian Treasury bills with longer duration last week amid significant oversubscription, boosted by robust liquidity in the financial system.
Reflecting sustained appetite for the naira asset, the Treasury bills secondary market opened the week on a positive note, supported by Nigeria’s improved macroeconomic conditions.
Driving real return on investment higher slightly, inflation declined to 15.91% while the market anticipates the monetary policy to maintain the status quo on the benchmark interest rate, hanging at 26.50%.
Fixed income market analysts said there was buying interest at the short end and belly of the Nigerian curve in the treasury bills market yesterday. Hence, the average yields contracted by 3bps to settle at 18.37%.
Specifically, buying interest was seen on the 3 Jun 2027, 17 Jun 2027, and 15 Jul 2027 NTBs, which were quoted at 17.30% offer, 17.35% offer, and 17.45%/17.35%, respectively.
Also, the OMO segment recorded limited activity, with mild interest observed on the 24 Nov 2026 and 8 Dec 2026 OMO bills, quoted at 20.10%/19.90% and 19.57% bid, respectively, Herwood Capital Limited said in a note. Nigeria Inflation Eases but Rising Food Costs Put Markets on Alert
