The Central Bank of Nigeria successfully conducted an auction of Nigerian Treasury Bills on March 27, 2024, which saw a substantial amount of N1.64 trillion being sold, as shown in the auction resulta report.
Investors were attracted to the higher stop rates offered as they were convinced of the country’s economic instruments, according to nairametrics.
During this latest auction, three categories of NTBs were offered, with varying tenors of 91 days, 182 days, and 364 days. The auction date was on March 27, 2024, with the allotment date following a day after, on March 28, 2024.
Three categories of NTBs with varying tenors of 91 days, 182 days and 364 days were offered at this latest auction. The auction date was on March 27, 2024, with the allotment date following a day after, on March 28, 2024.
The shortest tenor bills, the 91-Day NTBs, offered an amount of N17.606 billion, attracting a subscription of N76.812 billion, indicating a moderate demand level. The bills have been set to mature on June 27 27, 2024.
The 182-day NTBs showed higher demand, with an offered amount of N1.560 billion and a hefty subscription of N58.184 billion. Maturing on September 26, 2024, these medium-term bills saw a bid range from 16.0000% to 22.0000%, signalling robust market optimism. As interest in mid-term investment vehicles increased, a final stop rate of 17.0000% was determined.
The longest tenor, the 364-Day bills, had a remarkable turnout. With an offer of N142.162 billion, it garnered a staggering subscription of N2.483 trillion, indicating a significant surge in investor confidence. These bills will mature on March 27, 2025.
The success of the auction and increasing interest in national treasury bills demonstrate a strong investors appetite for higher interest rates, which will contribute firmly to Nigeria’s financial stability.
The CBN’s decision to tighten monetary policy by increasing interest rates and auctioning larger volumes of treasury bills is a strategic move to address several macroeconomic concerns.
The Central Bank of Nigeria’s decision to tighten currency policy by raising interest rates and auctioning more treasury bills is a strategic move aimed at addressing economic issues.
