Yields on Nigerian treasury bills fall after CBN holds rate – Reuters

CBN

LAGOS, June 2 (Reuters) – Yields on Nigerian short-dated treasury bills fell across the board at an auction on Wednesday where the central bank sold a total of 143.85 billion naira ($722.86 million), the bank said on Thursday.

The drop in yields reflected the decision of the Nigeria’s rate-setting Monetary Policy Committee (MPC) to hold interest rate at 12 percent last week.

The central bank sold 45.85 billion naira in the 3-month treasury bill at 7.99 percent, down from 8.10 percent at the previous auction on May 18.

A total of 18 billion naira worth of the 6-month paper was sold at 9.05 percent, against 9.20 percent previously, while 80 billion naira of the one-year debt was sold at 111.10 percent compared with 12.48 percent previously.

Investors demanded a total of 394.27 billion naira against 216.5 billion subscription at the last auction.

Dealers said the drop in yields was anticipated because the government was not willing to increase its borrowing cost.