Treasury Bills Yields Close Mixed Across Tenors Tuesday

By Dipo Olowookere

Yields of treasury bills at the secondary market moved in three different directions on Tuesday as investors prepare for today’s primary market auction by the Central Bank of Nigeria (CBN).

Business Post reports that while yield on the one-month instrument went up by 0.28 percent to close at 12.45 percent from 12.17 percent, yield on the six-month maturity finished flat at 13.22 percent.

However, yield on the three-month tenor went down by 0.40 percent to 12.72 percent from 13.12 percent, while yield on the one-year bill depreciated by 0.07 percent to 14.80 percent from 14.87 percent.

As a result of the bullish activity witnessed at the secondary market yesterday, the average yields of treasury bills declined by 0.05 percent to settle at 13.30 percent.

At today’s PMA, the apex bank will auction T-bills worth N125 billion to investors and would be sold in the usual three maturities; 91-day bill worth N4.38 billion, 182-day bill worth N12.92 billion and 364-day bill worth N107.94 billion.

With the barring of individuals, local firms and non-bank financial institutions from participating in open market operations (OMO) auctions of the apex bank, there would be rush for T-bills, which are still open to them.

Meanwhile, at the money market yesterday, the money market rates remained at single-digit despite the Open Buy Back (OBB) and Overnight (OVN) rates closing higher amid significant liquidity in the financial system.

While the OBB rate hit 5.14 percent from 4.43 percent, the OVN rate moved to 5.79 percent from 5.57 percent at the previous session.

With OMO maturity of about N406 billion expected to hit the system this week, the rates are anticipated to remain at the present levels.