The average yield on Nigerian Treasury bills cleared around 19% in the secondary market due to selloffs amidst a declining inflation rate. The market opened the week on a calm note with mixed sentiments.
Fixed income analysts anticipate a potential moderation in yields, citing strong demand for government securities. “While demand emerged for select papers across the yield curve, it was offset by selling pressure from investors raising liquidity amid a system liquidity deficit of over ₦700 billion,”
The 5-February bill saw the sharpest decline in yield (-4bps), while the 6-November paper recorded the biggest jump (+93bps). On the day, the average benchmark yield rose 13bps, closing at 19.01%, ahead of the midweek Treasury bill auction.
Investors have shown growing preference for longer-tenor instruments, with notable activity in the 12 March 2026 paper. Traders also observed a slight dip in rates following the release of February 2025 inflation data, which indicated a 130 basis points decline to 23.18% year-on-year.
Cordros Capital Limited reported a yield contraction in the short (-3bps) and mid (-1bps) segments, driven by demand for 52-day (-3bps) and 157-day (-9bps) maturity bills. However, yields expanded at the long end (+22bps) due to selloffs in the 234-day maturity (+93bps) bill. Meanwhile, the average yield in the Open Market Operations (OMO) segment declined by 4bps to 22.4%.
As part of its liquidity management strategy, the Central Bank of Nigeria (CBN) is set to open ₦800 billion worth of Treasury bills for subscription on Wednesday. Investors remain cautious ahead of the auction, closely monitoring market trends and inflationary pressures.
