The Central Bank of Nigeria has reduced the stop rate on its 364-day Treasury bill to 17.15 per cent, even as investors submitted bids worth ₦3.63tn for the instrument at its latest primary market auction.
The strong demand for the one-year bill accounted for 95.9 per cent of the ₦3.79tn total bids received across the three maturities offered by the apex bank on Wednesday.
The latest stop rate represents a 44-basis-point decline from the 17.59 per cent recorded at the previous auction.
The CBN offered a total of ₦700bn in Treasury bills, comprising ₦100bn each for the 91-day and 182-day instruments and ₦500bn for the 364-day bill.
Despite the substantial offer, total subscriptions exceeded the amount on offer by more than five times, reflecting strong investor appetite for government securities.
The 364-day bill recorded the highest demand, with subscriptions reaching ₦3.63tn, equivalent to 7.26 times the ₦500bn offered.
Following the strong demand, the CBN allotted ₦638.19bn, exceeding the initial offer by ₦138.19bn. However, the amount accepted represented only about 17.6 per cent of the total bids submitted for the instrument.
Investors quoted rates ranging from 16 per cent to 19.05 per cent, but the CBN settled at a stop rate of 17.15 per cent.
The outcome indicates that the central bank was able to reject higher-priced bids while still attracting substantial funding, benefiting from the intense demand for the one-year security.
Demand for shorter-term instruments was considerably weaker.
The 91-day Treasury bill attracted ₦103.32bn in subscriptions against an offer of ₦100bn. The CBN subsequently allotted ₦89.10bn at an unchanged stop rate of 16.30 per cent.
The auction highlights a growing preference among investors for longer-dated government securities, with the overwhelming demand for the 364-day bill suggesting that market participants are seeking to lock in prevailing yields for a longer period.
The development also comes as investors continue to assess the outlook for interest rates and returns in Nigeria’s fixed-income market.