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CBN Generates (N216bn) More Than Expected In Treasury Bills

The Central Bank of Nigeria (CBN) on Wednesday generated N215.88 billion at the treasury bill auction, an amount which is N75 billion more than the originally planned revenue from the transactions. Trader said that this was after it had received its subscriptions for about four times the amount of debt initially on offer.

Central Bank Of Nigeria
Central Bank Of Nigeria.

The financial breakdown showed that the one-year paper accounted for most of the debt incured during the process of the sales and that total subscriptions at the auction stood at N559 billion. Investors made bids reaching up to 18.9 per cent for the debt lasting one year and as little as 13.5 per cent for the three months note.

Logistics also revealed that the Central Bank generated N22.78 billion in three-month bills at the rate of 13.15 per cent, N24.74 billion in six-month bills at a rate of 16.8 per cent and N168.36 billion in one-year bills at a rate of 17 per cent.

Traders of the bills have it that foreign investors sold dollars last week in anticipation of the auction of the Treasury bills and this greatly increased the demand for the bills and also liquidity on the currency market as well, ultimstely resulting in a stampede to buy them off at the auctions.

Currency market liquidity however dwindled on Wednesday as some international investors were waiting to affirm where the profits would rest.  This was probably due to previous instabilities in the country’s economic productivity levels and the investors may have decided to speculate a bit more before entering the currency market, NigeriaNewsNg observes.

See here for more on the Treasury Bills and the Currency Market.

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