SAT MAY 10 2025-theGBJournal| Nigerian treasury yields were mixed on Friday and closed out the week with investors staying optimistic ahead of Central Bank of Nigeria’s (CBN) monetary policy stance.
The FGN bond secondary market activity was driven by investor’s demand for mid-dated bonds.
As a result, the average yield climbed 2bps to 19.1%.
Across the benchmark curve, the average yield rose at the short (+12bps) and long (+2bps) ends, driven by selloffs of the MAR-2027 (+59bps) and APR-2037 (+15bps) bonds, respectively, while it decreased at the mid (-7bps) segment following demand for the APR-2032 (-47bps) bond.
Similarly, the Treasury bills secondary market traded with bullish sentiments as market participants looked to fill unmet bids at the NTB PMA.
The average yield across instruments fell by 18bps to 23.5%.
Across the market segments, the average yield declined by 10bps and 18bps to 21.0% and 26.9% at the NTB and OMO segments, respectively.
At Wednesday’s NTB auction, the CBN offered bills worth N550.00 billion – N50.00 billion for the 91D, N100.00 billion for the 182D, and N400.00 billion for the 364D bills.
Total subscription levels settled lower at N1.09 trillion (previous auction: N1.54 trillion), indicating a bid-to-offer ratio of 2.0x (previous auction: 3.9x).
The auction closed with the CBN over-allotting to the tune of N598.33 billion – N77.22 billion for the 91D, N38.49 billion for the 182D, and N482.62 billion for the 364D papers – at respective stop rates of 18.00% (unchanged), 18.50% (unchanged) and 19.63% (previous: 19.60%).
The CBN also conducted an OMO auction on Tuesday (6 May), offering instruments worth N500.00 billion – N250.00 billion for the 315D and N250.00 billion for the 329D – to investors. Total subscription settled at N773.74 billion (bid-to-offer: 1.5x), with the CBN allotting N756.74 billion – N40.35 billion for the 315D and N716.39 billion for the 329D.
Meanwhile, the overnight (OVN) rate expanded by 12bps w/w to 27.0% as debits for the net NTB issuance (N48.33 billion) pressured system liquidity.
The average system liquidity, though still healthy, settled at a lower net long position of N915.26 billion (vs a net long position of N1.36 trillion in the previous week).
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