The Central Bank of Nigeria (CBN) has reduced the spot rate on its 364-day, or one-year, Nigerian Treasury bill to 15.85 per cent following an oversubscribed primary market auction held on Wednesday.
The Debt Management Office (DMO), on behalf of the CBN, auctioned Nigerian Treasury bills worth N900 billion across the standard tenors in the first auction under the fourth-quarter sales programme.
At the auction, the authority offered N100 billion each in 91-day and 182-day Nigerian Treasury bills, while N700 billion was offered in the 364-day tenor.
The auction attracted total subscriptions of about N1.77 trillion from investors seeking positions across the three standard tenors, with N968.50 billion ultimately allotted.
The 91-day and 182-day Treasury bills were both undersubscribed and under-allotted, while demand was heavily concentrated on the 364-day bills as investors sought longer-duration instruments.
The 91-day papers attracted N39.42 billion in subscriptions, of which N38.55 billion was allotted at a spot rate of 15.50 per cent, unchanged from the previous auction.
The 182-day Treasury bills recorded N46.87 billion in subscriptions, with N44.92 billion allotted at a spot rate of 15.80 per cent.
Demand was significantly stronger for the 364-day Treasury bills, which attracted more than N1.683 trillion in subscriptions against an offer size of N700 billion, reflecting sustained investor appetite for longer-term government securities.
The CBN allotted N885 billion from the subscriptions received for the one-year bills and reduced the spot rate to 15.85 per cent from 15.89 per cent at the previous auction.
The latest auction underscores continued investor demand for longer-tenor Nigerian Treasury bills despite the moderation in the one-year spot rate.
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