The average yield on Nigerian Treasury bills (NTBs) fell by four basis points (bps) in the secondary market on Wednesday as investors continued to increase their exposure to naira-denominated assets.
Demand for longer-dated Treasury bills remained strong during trading, with investors seeking to lock in attractive yields following recent repricing across the long-tenor segment of the market.
Amid mixed expectations around inflation trends and interest rate movements, real returns on fixed-income investments remain in double-digit territory, with Treasury bill yields still providing coverage against elevated consumer price pressures.
Market activity showed increased demand for NTBs maturing on March 4, 2027, and July 8, 2027. The yields on the two instruments declined by 26bps and 16bps to 18.67 per cent and 19.88 per cent, respectively.
However, investors reduced exposure to Treasury bills with a June 3, 2027 maturity date, pushing the associated yield higher by five basis points to 19.69 per cent.
“Demand was observed in select papers, including the 6 May 2027, 3 Jun 2027, 15 Jul 2027, and 29 Jul 2027 NTBs, which were quoted at 17.10%/16.90%, 16.90% offer, 16.90% offer, and 16.95%/16.90%, respectively”, Herwood Securities Limited said in a note.
Overall, the average NTB yield declined to 18.11 per cent from 18.15 per cent, reflecting a mild bullish sentiment in the secondary market, which analysts expect to persist.
In the Open Market Operations (OMO) segment, trading activity was concentrated around January and December maturities.
The January 12, 2027; January 19, 2027; December 15, 2026; and December 22, 2026 OMO bills were quoted at 19.10 per cent offer, 19.05 per cent offer, 20.05 per cent/20.00 per cent, and 20.05 per cent/19.95 per cent, respectively.
Fixed-income market analysts expect a similar trading pattern on Thursday, with market direction likely to be influenced by prevailing liquidity conditions and the possibility of an OMO auction.
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