The Central Bank of Nigeria (CBN) is set to hold its second Treasury Bills auction of January 2026, offering a total of ₦1.15 trillion across the 91-day, 182-day and 364-day maturities. The auction comes amid elevated system liquidity and mixed investor expectations on interest rates and inflation.
🔹 Market context:• Investors are closely watching liquidity levels and inflation data, which influence appetite for short-term government securities.
•Earlier trading this week saw some volatility in the T-bill market, with yields moving higher mid-week before stabilising on softer inflation data.
Key insights:• Strong system liquidity is expected to support investor participation. expectations especially around inflation and monetary policy direction — are shaping demand across maturities. .NgStay tuned for auction results and investor reaction later today!— Source: Nairametrics & sector reports (published today) �Nairametrics
In December, the stop rate on 91-day bills rose to 15.80% from 15.50%, while the 182-day bills climbed to 16.50% from 15.95%. One-year bills were sold at 18.47%, up from 17.51%, reinforcing expectations of firm yields across the curve.
The CBN had also stepped up rates at previous auctions, even as headline inflation softened in November, a move that signaled its cautious stance on inflation sustainability and exchange rate stability.
Secondary market trades calm as investors turn to auctions Trading in the secondary Treasury bills market has continued to swing from calm to bearish, reflecting a cautious undertone amid light activity, despite ample liquidity in the banking system.
Most maturities closed flat as investors adopted a wait-and-see approach ahead of the primary auction and a recent Open Market Operations (OMO) sale. Notably, only the 09-Apr-26 and 07-Jan-27 papers recorded yield movements, rising by 58 basis points and 12 basis points, respectively.
Other tenors were largely unchanged, indicating subdued demand and selective positioning. Earlier, the CBN allotted N2.64 trillion across 203-day and 245-day OMO papers at stop rates of 19.38% and 19.39%.
Following this, the average Treasury bill yield edged up by four basis points to close at 18.14%, reflecting negative sentiment driven by selloffs in the secondary market.
Backstory CBN raised a total of N1.144 trillion at its first NTB primary market auction of 2026, at higher stop rates across all maturities amid sustained investor demand.
At the January 7 auction, DMO raised N108.17 billion for the 91-day, N48.23 billion for the 182-day, and N987.78 billion for the 364-day maturities at higher rates, as investors repriced the risk-free assets across all maturities, particularly at the long end of the curve.
In contrast, yields on T-bills later declined to an average of 18.10% for the 364-day Bills at the secondary market, as investor demand for naira-denominated government assets strengthened ahead of the auction.
Trading activity remained largely subdued, with only marginal yield adjustments across most maturities. However, longer-dated bills due in January 2027 attracted stronger interest, pushing their yield down to 17.51%.
Image Credit: Nairametrics
Source : Nairametrics
