Primary Market Watch: Treasury Bills

CBN to offer N700 billion Treasury Bills on Wednesday

The Central Bank of Nigeria (CBN), on behalf of the Federal Government, will conduct a N700 billion Treasury bills auction on Wednesday, 8 July 2026, comprising N100 billion in 91-day bills, N100 billion in 182-day bills and N500 billion in 364-day bills. Against N269.36 billion of maturing Treasury bills, the auction implies a net issuance of approximately N430.64 billion, signalling a continued liquidity withdrawal from the financial system.

Market Backdrop

Average system liquidity declined by 12.26% month-on-month to N4.58 trillion in June from N5.22 trillion in May, as of today (6th July 2026), system liquidity is N2.31 trillion, reflecting the CBN’s sustained liquidity tightening measures. Treasury bill yields in the secondary market remained elevated ahead of the auction, reflecting prevailing tight liquidity conditions and investors’ preference for higher returns., with the average yield easing only marginally to 18.42% as of 3 July. Benchmark yields stood at 17.47% (1-month), 16.98% (3-month) and 19.76% (12-month), indicating that investors continue to demand relatively high returns.

Source: CBN

Previous Auction Review

The previous NTB auction produced mixed demand across maturities. Investor appetite remained strongest for the 364-day bill, which attracted subscriptions of N1.66 trillion against N800 billion offered, translating to a bid-to-cover ratio of 2.08x. In contrast, the 91-day bill recorded a bid-to-cover ratio of 1.30x, while the 182-day bill remained undersubscribed at 0.70x.

Pricing also firmed at the June auction. The stop rate on the 364-day bill increased sharply to 17.34% from 16.35%, while the 91-day and 182-day stop rates also rose to 16.28% and 16.50%, respectively.

Source: CBN

FMDA View

• The net issuance of approximately N430.64 billion is expected to sustain the CBN’s liquidity tightening stance, limiting the amount of excess liquidity available for the auction.
• Demand is likely to remain strongest for the 364-day Treasury bill as investors continue to favour locking in attractive yields at the longer end of the curve.
• Secondary market Treasury bill yields remain above the previous auction stop rates, suggesting that stop rates may remain elevated, particularly for the 364-day tenor.
• Demand for the 91-day and 182-day bills is expected to remain relatively subdued compared with the longer tenor.