Nigeria’s fixed-income market is bracing for another major liquidity event as the Central Bank of Nigeria (CBN) prepares to open ₦1.15 trillion worth of Nigerian Treasury Bills (NTBs) for investor subscription at its next primary market auction scheduled for Wednesday.
The auction comes barely two weeks after the market reopened for the year and will feature the standard 91-day, 182-day and 364-day tenors, drawing strong attention from investors navigating elevated yields and surplus system liquidity.
Market analysts expect heavy demand and possible oversubscription, driven largely by excess liquidity within the banking system and sustained appetite for risk-free instruments amid lingering macroeconomic uncertainty.
Market Sentiment Remains Mixed Despite Liquidity Surplus
In the week preceding the auction, the Treasury bills secondary market experienced notable volatility, with investor sentiment tilting negative despite ample liquidity conditions.
Trading opened on a mixed footing as sell pressure dominated short-to-mid tenors, reflecting cautious positioning ahead of key macroeconomic indicators, particularly inflation data. This defensive posture pushed yields higher midweek, with the average benchmark discount rate peaking at 16.64 per cent.
Significant yield expansion was recorded on specific maturities, including 4 June 2026, 6 August 2026 and 3 September 2026 bills, as market participants selectively offloaded positions. Overall activity remained muted, indicating limited portfolio rebalancing and cautious demand across the curve.
Inflation Data Sparks Mild Recovery at Long End
Sentiment improved marginally towards the end of the week following the release of Nigeria’s December inflation figure of 15.15 per cent, which came in softer than anticipated. Improved liquidity dynamics also supported renewed interest in longer-dated instruments.
Mild demand resurfaced at the long end of the curve, particularly on the 7 January 2027 Treasury bill, where the yield compressed by 35 basis points to 17.66 per cent.
However, early-week weakness outweighed the late rebound, leaving the benchmark discount rate up by 20 basis points week-on-week, closing at 16.65 per cent. The movement signals a market that remains cautious but increasingly receptive to yield stabilization.
CBN Maintains Aggressive Rate Stance at 2026 Opening Auction
At the first Treasury bills auction of 2026, the CBN sustained its tight monetary posture, raising spot rates across all standard tenors after recording ₦1.543 trillion in total subscriptions.
Out of the ₦1.15 trillion offered, the Apex Bank allotted ₦1.144 trillion, underscoring strong investor participation. Demand was particularly pronounced on the 364-day bills, which attracted ₦1.38 trillion in subscriptions, reflecting a clear preference for higher-yielding long-term instruments.
Spot rates continued the upward trajectory that began in the fourth quarter of 2025. The CBN priced the 91-day bill at 15.80 per cent, up from 15.30 per cent at the previous auction. The 182-day bill cleared at 16.50 per cent, compared to 15.50 per cent earlier, while the 364-day tenor saw its discount rate lifted to 18.47 per cent, from 17.95 per cent. The aggressive pricing reinforces the CBN’s resolve to manage inflationary pressures while keeping domestic liquidity in check.
 prepares to open ₦1.15 trillion worth of Nigerian Treasury Bills (NTBs) for investor subscription at its next primary market auction scheduled for Wednesday.){kind=link}