The Central Bank of Nigeria (CBN) has increased treasury bill rates after keeping the monetary policy rate at 26.5% last month as inflation accelerated toward 16%.
At the first primary market auction in June, the apex bank, through the Debt Management Office (DMO), offered N700 billion worth of treasury bills for subscription across standard tenors.
The auction circular revealed that the CBN planned to raise N150 billion from 91-day bills, N50 billion from 182-day bills, and N500 billion from 364-day bills.
The auction recorded significant subscriptions from yield-seeking investors who participated in the midweek session, including banks, pension funds, and other asset managers.
Total subscriptions reached approximately N2.161 trillion, as investor appetite for the naira asset remained elevated.
The breakdown showed that Nigerian Treasury bills with 364-day tenors attracted N1.946 trillion from market participants, accounting for 90% of the aggregate subscriptions.
The CBN allotted N1.243 trillion worth of one-year bills at a stop rate of 16.35%, representing a 20-basis-point increase from 16.15% at the previous auction. Additionally, investors showed strong interest in the 91-day Treasury bills, with the spot rate closing at 16.05%, up from 15.949% at the previous auction.
The CBN approved all subscriptions for these shortest-tenor Treasury bills, totaling N131.181 billion.
The mid-tenor 182-day bills, worth N82.979 billion, were sold at a spot rate of 16.19%, up from 16.14%, as investors continue to seek attractive investment options across the money market.
In the secondary market, the average yield on treasury bills contracted by 2 basis points to 17.45%, reflecting minimal contractions across the yield curve.
Yields fell by 1 basis point in both the short and mid segments, and by 2 basis points in the long segment, with notable demand observed for the 22-APR bill, which dropped by 25 basis points.