There are expectations among investors that sell pressure will linger as system liquidity remains depressed and investors anticipate February inflation figures.
This week’s Nigeria Treasury Bill (NTB) Primary Market Auction (PMA) had a total subscription of N1.66 trillion against N337.89 billion offered across the standard maturities.
Dealers said investors’ expectation of higher interest rates roused oversubscriptions at the auction. The stop rates for 91-day and 182-day increased by 24 basis points (bps), 50bps and 249bps to close at 17.24 percent, 18.00 percent and 21.49 percent respectively. The oversubscription was across the three tenors, with the 364-day bill having the highest at N1.54 trillion. Eventually, the Central Bank of Nigeria (CBN) settled for N1.32 trillion, -21 percent lower than the total subscription
The CBN said it would sell Treasury Bills worth N1.64 trillion for the second quarter 2024 (Q2’24).
This was contained in the apex bank’s Nigeria Treasury Bills Issue programme released recently.
Treasury Bills are short term (less than one year) debt instruments used by the CBN to borrow money from the public on behalf of the Federal Government. The CBN also uses TBs to control money supply in the economy.
The TB issue programme commences on March 7, and ends on May 23, 2024.
During the period, the apex bank will issue TBs worth N414.29 billion on 91-day tenor, N43.74 billion on 182-day and N1.18 trillion on 364-day tenors.
A breakdown of the programme revealed that in March, the apex bank plans to sell N660.62 billion worth of TBs, comprising N32.73 billion worth of 91-day bills, N12.97 billion worth of 182-day bills and N614.92 billion worth of 364-day bills.
In April, the apex bank plans to sell N292.17 billion worth of TBs, comprising N10.61 billion worth of 91 days bills, N15.97 billion worth of 182-day bills, and N265.59 billion worth of 364-day bills.
In May, the CBN plans to sell N688.3 billion worth of TBs comprising N362.9 billion worth of 91-day bills, N14.7 billion worth of 182-day bills and N302.67 billion worth of 384-day bills.
Treasury bills or T-Bills are short-term debt securities issued by the government to make up for budget deficit and fund projects.
In Nigeria, T-Bills are issued by the Central Bank of Nigeria (CBN) on behalf of the Federal Government.
