FG raised N176 bn in T-Bills on lower yields

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Kayode Tokede with News agency

The federal government has raised N176 billion worth of treasury bills at an auction on Wednesday, traders said.

The Central Bank of Nigeria (CBN) offered N6 billion of three-month paper, N30 billion of six-month bills and N140 billion of one-year notes.

The bank issues treasury bills twice a month to help the government to finance its budget deficit, curb money supply growth and provide an avenue for lenders to manage liquidity.

Total demand for the notes stood at N229.9 billion as investors were demanding as high as 20 per cent yields for the one-year paper, which sold for 13.7 per cent. It sold the one-year paper at 14.3 per cent in January.

The bank auctioned the three-month bill at 11.95 per cent from 12.55 per cent last month and the six-month note at 13.65 per cent from 13.92 per cent.

The government has been working to lower its borrowing costs, particularly as inflation fell for the 12th time in a row on Wednesday. The government also plans to refinance $2.5 billion worth of treasury bills from the proceeds of a planned eurobond sale this first quarter.

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