Yield Slips ahead of CBN’s N530bn Treasury Bills Auction
The average yield on Nigerian Treasury bills slipped slightly as a result of increasing demand for naira assets in the fixed income market. Traders said in separate reports that yield declined by 2 basis points to settle at 25% in the secondary market as investors boost portfolios ahead of the primary market auction.
On behalf of the Central Bank of Nigeria (CBN), the Debt Management Office will offer N530 billion across standard maturities to investors in the primary market on Wednesday. Investment banking firm analysts have started to predict that demand will be strong as liquidity levels in the banking system improved yesterday.
In the secondary market, there was a mild bullish bias amidst inflation pressures on real return on investment in the fixed income space. Transactions pattern showed a subdued trend with investors selectively purchasing a few securities maturing between November 2025 and January 2026.
Most participants reduced their buying activity despite increased appetite in cautious optimism mode. Hence, yields moderated slightly across the curve, particularly at the long end, TrustBanc Financial Group Limited told investors in a note.
Analysts said 11-Dec and 8-Jan bills were quoted at 22.00/21.65 and 21.80/21.45, respectively. The DMO will open offer for subscription of Treasury bills worth ₦530 billion across the 91, 182, and 364-day papers.
Analysts at TrustBanc Financial Group Limited anticipate subdued trading activity in the secondary market as participants prepare their bids for the auction. Across the curve, the average yield contracted at the short (-2 bps) and long (-2 bps) ends, Cordros Capital Limited said in a note.
The yield contracted on the back of demand for the 65-day to maturity (-2bps) and 303-day to maturity (-6bps) bills, respectively. However, yield remained unchanged at the mid-segment due to thin activities on local Treasury bills. Similarly, the average yield contracted by 6bps to 28.2% in the OMO segment.
Overall, the average benchmark yield declined by 2 bps to close at 25.16%. #Yield Slips ahead of CBN’s N530bn Treasury Bills Auction Ministry Seeks $2 billion Fibre Optics Funding
