By Boluwatife Oshadiya | March 12, 2026
Key Points
- CBN lowers the interest rate on 364-day Treasury bills to 16.72%
- Investors submit ₦2.56 trillion in bids against ₦600 billion offered
- Total allotment across tenors reaches ₦933.92 billion at the latest auction
Main Story
The Central Bank of Nigeria (CBN) has reduced the interest rate on its one-year Treasury bills, following overwhelming investor demand at the latest primary market auction.
Auction results show the 364-day Treasury bill was priced at 16.72%, slightly lower than the 16.73% yield recorded at the previous auction, as strong demand allowed the apex bank to borrow at a marginally cheaper rate.
Investors submitted ₦2.567 trillion in bids for the one-year instrument, far exceeding the ₦600 billion initially offered, reflecting sustained appetite for Nigerian government securities amid elevated interest rates.
Overall, the CBN offered ₦850 billion in Treasury bills across three tenors — 91 days, 182 days, and 364 days. Total investor subscriptions reached ₦2.78 trillion, while the central bank ultimately allotted ₦933.92 billion.
For the 91-day bills, the apex bank offered ₦100 billion but received ₦130.74 billion in bids, allotting the full amount at a 15.95% discount rate, unchanged from the previous auction.
Demand for the 182-day tenor was weaker. Investors submitted ₦82.34 billion against the ₦150 billion offered, prompting the CBN to allot ₦71.37 billion at 16.65%, also unchanged from the prior auction.
The strong response to longer-tenor securities suggests investors remain confident in Nigeria’s domestic debt market, particularly as monetary policy remains tight to combat inflation.
The Issues
The heavy demand for Treasury bills reflects Nigeria’s high-interest-rate environment, where fixed-income instruments currently offer some of the most attractive risk-adjusted returns in emerging markets.
Since 2024, the CBN has maintained tight monetary policy to curb inflation and stabilise the naira, pushing yields on government securities to multi-year highs.
For institutional investors such as pension funds, banks, and asset managers, Treasury bills remain one of the safest and most liquid investment options in the domestic market.
However, economists warn that sustained high borrowing through short-term securities could increase Nigeria’s domestic debt servicing burden, particularly if yields remain elevated for an extended period.
What’s Being Said
“Strong investor participation reflects growing confidence in Nigeria’s monetary policy framework and the attractiveness of our domestic fixed-income market,” the Central Bank of Nigeria said in the auction summary released after the sale.
Financial market analyst Ayodeji Ebo, Managing Director of Afrinvest Securities, said the oversubscription highlights a shift toward longer-term instruments.
“Investors are locking into the longer tenors because yields remain attractive relative to inflation expectations and currency risks,” Ebo said.
What’s Next
- Investors will monitor secondary market Treasury bill yields for signs of further rate adjustments.
- The next primary market auction is expected later in the month.
- Attention will also focus on the CBN’s next MPC meeting, where interest-rate policy could influence future government borrowing costs.
The Bottom Line: The strong oversubscription suggests investor demand for Nigerian fixed-income assets remains robust, giving the government room to marginally lower borrowing costs even in a high-rate environment.
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