CBN Sells N75b Treasury Bills in One Week

By Modupe Gbadeyanka

The Central Bank of Nigeria (CBN) last week auctioned treasury bills worth N74.79 billion to investors at the market.

The exercise comprised the sale of N40.95 billion via the Open Market Operations (OMO) and N33.84 billion via the Primary Market Auction (PMA).

According to analysts at Cowry Asset, the stop rates of the 91-day, 182-day and 364-day auctioned T-bills moderated to 10 percent from 10.25 percent, 10.50 percent from 10.95 percent and 10.70 percent from 11.15 percent respectively.

They noted that the outflows were offset by N330.30 billion in matured T-bills.

Consequently, NIBOR fell for most tenor buckets amid renewed financial liquidity ease: NIBOR for overnight, 1 month and 3 months tenor buckets fell w-o-w to 8.87 percent from 76.05 percent, 13.62 percent from 14.50 percent and 15.31 percent from 15.47 percent respectively.

However, NIBOR for 6 months tenor bucket rose to 16.99 percent from 16.67 percent.

Elsewhere, NITTY fell for all maturities tracked on renewed buy pressure: yields on the 1 month, 3 months, 6 months and 12 months maturities fell to 12.21 percent from 13.08 percent, 12.39 percent from 13.59 percent, 12.69 percent from 13.76 percent and 13.34 percent from 13.68 percent respectively.

Meanwhile, the Standing Deposit Facility (SDF) worth N858.19 billion, outweighed the Standing lending Facility (SLF) worth N83.94 billion; indicative of excess liquidity in the financial system.

This week, CBN will retire T-bills amounting to N266.95 billion via the secondary market. Hence, we anticipate ease in financial system liquidity with resultant moderation in interbank rates despite expected FGN bonds auction of N70 billion.