Demand Interests in One-Year T-Bills Drop Yield to 13.60%

By Dipo Olowookere

The secondary market for treasury bills traded on an insignificantly bearish note on Monday, with demand interests notable on the mid to long end of the curve.

Business Post reports that at the close of business, the average yields slightly appreciated by 0.01 percent to settle at 12.11 percent.

As earlier stated, there were huge demands for the 6-month and 12-month debt instruments on Monday, which dragged the yields lower at the market.

While the 6-month bill lost 0.03 percent to close at 12.62 percent, the 12-month instrument went down by 0.07 percent to finish at 13.60 percent.

However, yield on the one-month bill appreciated by 0.09 percent to close at 11.12 percent, while the 3-month tenor rose by 0.05 percent to finish at 11.10 percent.

According to analysts at Zedcrest Research, “We expect the recent demand interest to persist in absence of an OMO auction by the CBN.”

Meanwhile, the average rates in the money market inched slightly higher by 1.18 percent on Monday to settle at 10.15 percent.

This followed the 1.14 percent growth recorded by the Open Buy Back (OBB) rate and the 1.21 percent rise achieved by the Overnight (OVN) rate.

At the close transactions yesterday, the OBB rate grew to 9.86 percent from 8.71 percent, while the OVN rate jumped to 10.43 percent from 9.21 percent.

It was observed that the money market rates were on the higher side on Monday as a result of the funding of banks with a wholesale forex intervention by the Central Bank of Nigeria.

However, the rates are anticipated to dip slightly lower today in the absence of any anticipated funding pressures at the market.