By Boluwatife Oshadiya | July 23, 2026
Key Points
- Treasury bill yields declined as investors shifted funds from equities into fixed-income securities
- Average NTB yield eased to 18.34% amid strong demand across the yield curve
- Banking system liquidity remained above ₦3.2 trillion following OMO and Treasury bill maturities
Main Story
Nigerian Treasury bill yields declined in the secondary market as investors increased demand for fixed-income securities following the Central Bank of Nigeria’s (CBN) decision to retain the Monetary Policy Rate (MPR) at 26.5% and improving real returns after June’s lower inflation reading.
The renewed buying interest came as investors rotated capital out of the equities market, which shed about ₦801 billion in market value during the latest trading session due to sustained profit-taking. Strong liquidity conditions in the financial system also supported demand for government securities.
Trading activity was concentrated across the short, medium and long tenors of the Treasury bill curve, resulting in a one basis point decline in the average secondary market yield to 18.34%.
Market liquidity remained robust at approximately ₦3.23 trillion, supported by proceeds from recently matured Open Market Operations (OMO) bills and Nigerian Treasury bills, encouraging investors to increase holdings of short-term government securities.
According to Herwood Capital Limited, the 15 July 2027 Treasury bill attracted significant investor demand after opening with quotes of 17.40% bid and 17.30% offer, before moderating to 17.35% bid and 17.25% offer. Buying interest was also recorded in the 18 February 2027, 11 March 2027, 20 May 2027 and 17 June 2027 maturities.
Market data further showed yields contracted by one basis point at the short end and three basis points at the long end of the curve, although the medium segment recorded a marginal two basis point increase.
Activity in the OMO market remained concentrated on the 24 November 2026 and 8 December 2026 bills, quoted at 20.10% and 19.40%, respectively, with demand continuing to outpace available offers.
What’s Being Said
Herwood Capital Limited said investor demand remained strongest in recently issued Treasury bills, with buying interest supported by abundant system liquidity and improved real returns following the moderation in inflation.
What’s Next
- Investors are expected to monitor the next Nigerian Treasury bill primary market auction for fresh supply and pricing direction.
- Market participants will continue assessing inflation trends and future CBN monetary policy decisions for clues on interest rate movements.
- Liquidity conditions are expected to remain supportive in the near term as financial system cash levels stay elevated.
Bottom Line: Lower inflation, abundant banking system liquidity and the CBN’s decision to maintain interest rates are encouraging investors to increase exposure to Treasury bills. Unless liquidity tightens significantly or inflation reverses, secondary market yields are likely to remain under downward pressure.
