The stop rate for 91-day treasury bills was slightly lowered to 1.09 per cent on Wednesday by the Central Bank of Nigeria from 1.10 per cent at the last exercise.
The fixed income market has been very unattractive lately with rates crashing from double digits a few years ago (about 20 per cent) to the recent lows.
This has largely been due to the high level of liquidity in the financial system, which has made borrowing cheaper in the domestic market.
However, CBN approached the primary market with the debt instruments valued at N158.8bn across three tenors.
A CBN analysis showed that N2.0bn worth of 91-day bill, N8.4bn worth of the 182-day bill, and N148.4bn worth of the 364-day bill were offered to investors.
Though the short and mid-term maturities received considerable subscriptions from investors, it was observed that traders pulled back on the long-term tenor during the exercise unlike in the previous session.
At the close of the exercise, bids worth N4.0bn were received for the three-month instrument, the six-month bill received N15.5bn subscriptions, while the 12-month tenor received offers worth N184.4bn.
But CBN, which allotted the same amount of T-bills it auctioned at the PMA, sliced the stop rate for the 91-day maturity and the 182-day instrument to 1.50 per cent from 1.55 per cent.
It, however, left the stop rate of the one-year bill at 3.05 per cent.
Recently, the central bank directed commercial banks in the country not to give an interest rate of more than 1.25 per cent for savings deposits.
This, decision, according to the banking sector regulator, was taken to encourage investment in the economy to create jobs, pointing out that it discovered large companies were comfortable putting funds in the bank to yield interests instead of using the funds to generate more economic activities in the country.
