Market News
T-bills auction hits N1.21tn in subscriptions - PUNCH
The Central Bank of Nigeria recorded a sharp increase in subscriptions at its latest treasury bills primary auction, with total bids reaching N1.21tn despite offering a slightly reduced amount of N500bn.
Data from the auction held last week shows the CBN offered N500bn in treasury bills compared to N503bn at the previous auction. However, total subscriptions jumped to N1.21 tn, up from N1.09tn recorded previously, mainly driven by demand for the 364-day treasury bill. This instrument alone attracted subscriptions worth N1.05tn against an offer of N350 bn.
The CBN allotted a total of N615.81bn, exceeding the N579bn allotted at the prior auction. Stop rates for the 91-day and 180-day bills remained stable at 18.00 per cent and 18.50 per cent, respectively, while the 364-day bill’s stop rate declined slightly to 19.56 per cent from 19.63 per cent at the previous auction.
According to the latest Meristem Securities report, “The increase in subscription at the CBN’s treasury bills auction reflects improved system liquidity and a growing investor appetite for longer-dated instruments. Investors are showing confidence in the government’s debt market as yields remain attractive amid evolving macroeconomic conditions.”
In a similar development, the Debt Management Office conducted an Open Market Operation auction last week, offering N500bn across 182-day and 210-day tenors. The total subscription at the auction was N743.25bn, with N172.5bn for the 182-day and N570.75bn for the 210-day tenors. The Debt Management Office allotted N804.34bn, with stop rates settling at 23.77 per cent for the 182-day and 23.98 per cent for the 210-day instruments.
The Meristem report further stated, “The strong subscription at the DMO’s OMO auction underscores investors’ search for yield in a relatively high-interest rate environment, despite concerns over inflation and fiscal pressures.”
However, the secondary treasury bills market ended the week on a bearish note, reversing the previous week’s bullish trend. Average yields rose by four basis points to 20.88 per cent from 20.84 per cent the prior week. The short-end yields surged by 69 basis points due to sell-offs in the 97-day, 69-day, and 27-day bills, while mid-segment yields increased by eight basis points following sell-offs in the 125-day bill. Conversely, the long end of the curve experienced a dip of 33 basis points, with yields falling in the 293-day, 300-day, and 356-day maturities.
The local bond market traded positively, albeit with low trading activity. Average yields dropped by three basis points to 18.99 per cent from 19.03 per cent last week. The short end of the yield curve declined by 69 basis points, led by strong buying interest in bonds maturing in January 2026 and March 2026. The mid-segment also rallied with yields falling by 27 basis points, driven by renewed demand for bonds maturing in May 2033, July 2030, and February 2031. Meanwhile, the long end of the curve saw a slight rise of four basis points, influenced by sell-offs in bonds maturing in April 2037.
Meanwhile, the Eurobond market maintained its bullish momentum, with average yields declining by two basis points to 9.76 per cent from 9.79 per cent in the previous week. The yield decline was most notable in longer-term maturities, specifically the November 2047, January 2049, and September 2051 bonds.
Meristem analysts noted, “The Eurobond market’s continued bullish performance reflects growing investor optimism on Nigeria’s external debt profile and the gradual easing of global risk factors.”
Market experts interpret the mixed trends as investors recalibrating their positions amid ongoing macroeconomic uncertainties but remain optimistic about Nigeria’s debt instruments due to attractive yields and improving liquidity.
The PUNCH reported that the Central Bank of Nigeria’s latest Treasury Bills auction held on May 21, 2025, drew total bids worth N1.17tn, highlighting the continued strength of investor appetite for government securities amid high inflation and a stable interest rate environment.
