The Nigerian fixed-income market is preparing for a liquidity surge as Treasury bills valued at approximately ₦185 billion are set to mature across various tenors, including the 91-day, 182-day, and 364-day categories.
Market watchers are closely monitoring whether the Central Bank of Nigeria (CBN) will opt to refinance or roll over the maturing instruments, given the uncertainties surrounding its current auction calendar.
Ahead of the next round of Treasury bills issuance, fixed-income analysts have projected continued volatility in yields, with much of the outlook shaped by recent Open Market Operations (OMO).
At the latest midweek auction, the CBN reduced spot rates on the 91-day bills, while maintaining the mid-tenor offers unchanged. In contrast, yields on the one-year paper rose by 25 basis points, indicating a mixed approach by the apex bank.
Analysts interviewed by MarketForces Africa suggested that rates could soften in the coming sessions, mirroring price adjustments in the OMO segment of the market.
In total, maturities worth ₦184.75 billion are expected to influence short-term market rates, which analysts predict may hover around 26.5% in light of existing liquidity surpluses. However, expectations remain that benchmark short-term rates could climb higher if the CBN aggressively absorbs liquidity through fresh OMO sales.
