Investors bid N384bn worth of Treasury bills at 12.15% per annum

Investors bid N384 billion worth of one-year treasury bills in the latest auction of 26th July 2023 at a rate of 12.15 per cent per annum.

However, only N255 billion was allotted as investors continue to over-subscribe to the short-term risk-free investment.

The data was obtained from the latest auction report for Nigeria’s treasury bills sold during the week which sees the one-year bill matures on 25th July, 2024.

Rising Inflation

Nigeria’s inflation rate rose to 22.79 per cent in June 2023, representing a 0.38 per cent points increase from 22.41 per cent recorded in the previous month.

On a year-on-year basis, the Headline inflation rate was 4.19 per cent points higher compared to the rate recorded in June 2022, which was 18.60%.

This means there is growing demand for risk-free investments despite offering a negative real return of -10.64 per cent.

Investor stakes in treasury bills buttress a wider challenge in the economy as the lack of investable assets forces them to accept negative real returns in exchange for earning zero and losing up to 22.79% in inflation on their cash