By Modupe Gbadeyanka
The Central Bank of Nigeria (CBN) has disclosed that the Federal Government plans to sell N234.89 billion of short-dated treasury bills at an auction on April 6.
The apex bank issues treasury bills two times in a month to finance the budget deficit, help manage commercial lenders’ liquidity and curb rising inflation.
It would be recalled that Nigeria had in two consecutive auctions this month sold the one-year treasury bills at yields above the prevailing inflation rate, in a bid to lure investors to buy more of the debt.
According to the CBN, government plans to sell N35 billion of three-month debt, N33.49 billion of six-month bills and N166.40 billion of one-year notes, using a Dutch auction system.
It pointed out that payment will be due the day after the auction.
Nigeria expects its budget deficit to widen to N2.36 trillion in 2017 as it tries to spend its way out of a recession, with more than half the deficit to be funded through local borrowing.
Reuters
Adedapo Adesanya