Modupe Gbadeyanka
By Modupe Gbadeyanka
The average yields of treasury bills at the secondary market declined on Tuesday by 0.41 percent to settle at 12.96 percent.
This followed the relative calm experienced at the market yesterday with better offers on the short and mid end of the curve as against the relatively stronger bids seen on the longer end of the curve.
Business Post reports that yields on four of the five tenors on sale at the market depreciated on Tuesday with only the 9-month paper appreciating by 0.03 percent to end at 14.75 percent.
The one-month yield declined yesterday by 1.79 percent to 8.66 percent, the 3-month paper fell by 0.20 percent to 12.18 percent, the 6-month note dropped 0.03 percent to close at 14.25 percent, while the 12-month bill reduced by 0.05 percent to 14.96 percent.
Today, the Central Bank of Nigeria (CBN) will auction fresh treasury bills via the Primary Market Auction (PMA).
T-Bills worth N89.50 billion will mature, and an equal amount will be issued in the 91-day, 182-day and 364-day instruments.
The central bank will auction N5.00 billion, N14.00 billion and N70.50 billion in the 91-day, 182-day, and 364-day instruments respectively.
Given the recent stop in the one-year OMO offering by the apex bank, demand is expected to be heavily skewed to the 364-day bill with stop rates on the tenor expected to clear at 15 percent below the level at the previous NTB auction.
However, stop rates on the 91 and 182 day bills are expected to be relatively unchanged from previous levels.
Meanwhile, the Open Buy Back (OBB) and Overnight (OVN) rates declined by 1.16 percent and 1.25 percent respectively to 9.67 percent and 10.33 percent, as the average money market rate decreased by 1.21 percent to settle at 10.00 percent.
This was as system liquidity improved to N180 billion positive, in absence of an OMO auction by the CBN.
“We expect rates to remain relatively stable on Wednesday as there are no significant outflows anticipated,” analysts at Zedcrest Research said.
