By Modupe Gbadeyanka
There are strong indications that the stop rates of treasury bills will further fall this week when the Central Bank of Nigeria (CBN) rolls over some of the debt instruments.
The apex bank is expected to conduct the first primary market auction on Wednesday with a rollover of N95.68 billion T-bills.
Three maturities would be offered during the midweek exercise, viz: 91-day bills worth N10 billion, 182-day bills worth N17.60 billion and 364-day bills worth N68.08 billion.
“We expect their stop rates to fall amid buy pressure.
“Amid the N204.32 billion bills maturing, we also expect yields to further moderate amid declining stop rates,” analysts at Cowry Asset said in their weekly report.
Business Post reports that at the last exercise held on March 20, 2019, the stop rate for the 91-day bill cleared at 10.30 percent, the 12-day bill at 12.20 percent and the 364-day bill at 12.35 percent.
Last week, the absence of CBN T-bills auction at both primary and secondary markets and the matured N54.00 billion worth of treasury bills at the secondary market, as well as the distribution of the federally collected revenue worth N619.85 billion, boosted liquidity in the financial market.
As a result, NIBOR for overnight funds and 3 months tenure buckets moderated to 11.40 percent from 15.13 percent and 12.92 percent from 13.22 percent respectively.
However, 1-month and 6 months rate increased to 12.20 percent from 10.47 percent and 15.14 percent from 14.75 percent respectively.
Elsewhere, NITTY moved in mixed directions across maturities tracked as investors bought3 months and 12 months maturities but sold one and 6 months maturities – yields on 3 months and 12 months maturities fell to 11.00 percent from 12.09 percent and 14.49 percent from 14.65 percent respectively.
However, one-month and 6 months yields rose to 10.77 percent from 10.02 percent and 14.05 percent from 13.79 percent respectively.
Adedapo Adesanya