By Abiodun Folarin
WorldStage– The Central Bank of Nigeria (CBN), on behalf of the Debt Management Office, has opened subscriptions for N1.05 trillion in Treasury Bills across three maturities, with investors expected to chase yields amid easing inflation and a widening real return environment.
The apex bank conducted the third Treasury Bills (TBs) auction for the month on Wednesday, amidst liquidity surplus in the financial system.
At the midweek primary market auction, Nigerian Treasury bills with a 91-day maturity worth N100 billion will be available for investors.
Additionally, the CBN will offer N150 billion in 182-day bills for subscription. One-year Treasury bills totaling N800 billion will also be opened for subscription spot rate repricing.
The market anticipates strong demand for the midweek auction amid high liquidity in the financial system, said MarketForces.
At the previous auction, the CBN allotted N934 billion in treasury bills across standard tenors, out of total subscriptions of N2.78 trillion.
With ongoing disinflation, analysts expect the spot rate to decrease as the authorities aim to reduce the central bank’s funding costs. Real return has widened to 11.44 per cent as the 26.50 per cent interest rate benchmark continues to chase 15.06% headline inflation, which analysts see as a catalyst for fixed-income security repricing.
In the last auction, the monetary authority lowered the spot rate on 364-day bills to 16.72 per cent, down from 16.73 per cent. The discount rates for the 91-day and 182-day Treasury bills remained the same at 15.95% and 16.65 per cent, respectively.
