SAT APRIL 13 2024-theGBJournal| Following the shortened trading week, activities in the T-bills secondary market were mostly calm, with pockets of demand particularly at the long end of the curve.
As a result, the average yield across all instruments contracted by 9bps to 18.7% on Friday.
Across the segments, the average yield declined by 5bps to 18.9% in the NTB secondary market and dipped by 20bps to 18.2% in the OMO segment.
At this week’s NTB auction, the Central Bank of Nigeria (CBN) offered instruments worth N149.63 billion – N2.78 billion of the 91-day, N3.02 billion of the 182-day, and N143.84 billion of the 365-day bills – to participants.
Total subscription at the auction settled at N182 trillion (bid-to-offer: 12.2x), with more demand skewed towards the longer-dated bill (N1.77 trillion).
The auction closed with the CBN over-allotting bills worth N951.83 billion – N27.11 billion of the 91-day, N22.67 billion of the 182-day, and N902.04 billion of the 364-day – at respective stop rates of 16.24% (unchanged), 17.00% (unchanged), and 20.70% (previous: 21.12%).
Given our expectations of lower liquidity in the system next week, we anticipate participants’ demand for bills to moderate, resulting in an expansion of yields in the Treasury bills secondary market.
Nonetheless, we do not rule out a possible influx of unmet demand from Friday’s primary auction to filter into the secondary market in the coming week.
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