CBN May Lower Rate at N89.50bn T-Bills Sale

By Modupe Gbadeyanka

On Wednesday, March 13, 2019, the Central Bank of Nigeria (CBN) will sell treasury bills to investors via primary market auction.

During the exercise, fresh treasury bills worth N89.50 billion would be auctioned with N5 billion worth of the 91-day bills on offer.

Also, the apex bank will sell N14 billion worth of the 182-day paper, while N70.50 billion worth of the 364-day note would be sold.

According to analysts at Cowry Asset, “We expect their stop rates to moderate in accordance with recent trend which has seen the short term papers being highly sought for by investors especially as FAAC inflows are being anticipated coupled with maturing bills worth N215.86 which, we expect, will also drive down interbank rates.”

Last week, interbank rates increased amid strain in financial system liquidity as CBN auctioned treasury bills worth N808.96 billion in Open Market Operations (OMO), which more than offset maturing bills worth N229.60 billion.

As a result of this, NIBOR for 1 month, 3 months and 6 months tenure buckets increased to 11.09 percent from 10.48 percent, 13.09 percent from 11.71 percent and 14.74 percent from 14.12 percent respectively.

However, overnight funds rate moderated to 10.50 percent from 18.08 percent.

Elsewhere, NITTY increased for most maturities tracked amid renewed sell pressure – yields on 1 month, 3 months and 6 months maturities fell to 9.99 percent from 9.06 percent, 12.29 percent from 11.03 percent and 14.24 percent from 13.60 percent respectively. However, 12 months NITTY was unchanged at 14.95 percent.