Connect with us
Paramount
Advertisement
Ican
Advertisement
IZIKJON
Advertisement
Stanbic IBTC
Advertisement
Polaris bank
Advertisement
Binance
Advertisement
Esetech
Advertisement
Patricia
Advertisement
Fidelity ads
Advertisement
app

Debt Securities

Nigeria’s treasury bills rate falls to 0.5% per annum

Nigeria’s treasury bills rate was oversubscribed despite falling to 0.5%.

Published

on

CBN forex restrictions on food itemsCBN approves new cheque standard for banks

The latest treasury bills auction by the Central Bank of Nigeria reveals a 91-day bill sold for an interest rate of 0.34% one of the lowest in the history of the auction.

Treasury bills rate has fallen sharply since the central bank switched monetary policy from fighting inflation and attracting foreign portfolio inflows to boosting domestic credit. The CBN has frequently deployed heterodox policies over the years adopting what Nairametrics research has come to characterize as Meffynomics.

In the last action two weeks ago treasury bills stop rates for a 91-day bill was 1%. The latest auction also reveals 182 and 364-day bills have fallen to 0.5 and 0.98% respectively. Despite the drops, subscription rates for the bills more than doubled the actual bills on offer. For example, N84.8 billion subscription as against N49.8 billion for a 91-day bill. Even more shocking was the one year bill with investors staking a whopping N694.9 billion in subscription against N93.9 billion on offer.

What this means: The current rates are the closest we have seen to 0% suggesting that investors are willing to earn next to nothing rather than take risks in a failing economy.

  • Nigeria’s inflation rate is 13.71% and galloping towards stagflation. Nigeria is expected to announce it is formally in a recession in the coming weeks as the National Bureau of Statistics collates its data.
  • Billions have poured into the stock market in recent weeks as investors search for investments with better yields.
  • However, there are limited stocks out there that can guzzle up the hundreds of billions of naira available for investing.

Nairametrics is Nigeria's top business news and financial analysis website. We focus on providing resources that help small businesses and retail investors make better investing decisions. Nairametrics is updated daily by a team of professionals. Post updated as "Nairametrics" are published by our Editorial Board.

3 Comments

3 Comments

  1. Oqua Etim

    October 28, 2020 at 5:11 pm

    This one shock me: What this means: The current rates are the closest we have seen to 0% suggesting that investors are willing to earn next to nothing rather than take risks in a failing economy.

  2. Yemi Akande

    October 28, 2020 at 11:06 pm

    Nigeria at this challenging time needs more of businesses ranging from MSMEs to large scale ventures with Government diverse and intentional supports to revamp the economy.

  3. Emeka

    October 29, 2020 at 6:09 am

    Is it possible that we can have negative yields? What would this mean for investors and the economy?

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Advertisement




Advertisement

Nairametrics | Company Earnings