The Central Bank of Nigeria (CBN) will hold its first Treasury Bills (T-bills) Primary Market Auction (PMA) for May today, offering a total of N550 billion across three tenors.
The auction will feature N50 billion in 91-day bills, N100 billion in 182-day bills, and N400 billion in 364-day bills.
This follows the April 23 auction, where the CBN offered N400 billion, a 50 percent reduction from the N800 billion in the previous round. Improved system liquidity of N374.93 billion and maturing bills worth N369.78 billion spurred strong demand, with subscriptions rising to N1.53 trillion from N1.13 trillion. As a result, the subscription-to-offer ratio jumped to 3.83 times from 1.41 times.
The CBN eventually allotted N714.38 billion, with the 364-day tenor accounting for 91.03 percent of the total. Stop rates declined across all tenors despite wide bidding: 18.00 percent for 91-day, 18.50 percent for 182-day, and 19.60 percent for 364-day bills, down from 18.50, 19.50, and 19.63 percent, respectively.
At the auction, analysts expect rates to remain stable with a slight downward trend, backed by system liquidity at N1.21 trillion and maturing bills of N287.98 billion—2.73 times the amount on offer. The government’s push to reduce borrowing costs and positive investor sentiment also support this outlook.
Meanwhile, the secondary market remains bullish. Average yields, according to dealers from Meristem Research, dropped by 15 basis points to 20.97 percent, with strong demand in mid- and long-dated bills compressing yields by up to 458 basis points. However, short-dated instruments saw selective sell-offs, especially the 17-day bill, which surged by 506 basis points.
READ ALSO: Equities investors earn N1.04trn as bulls persists at NGX
and then