Subscriptions on one-year T-bill hit N2.53 trillion record high 

The one-year (364-day) T-bill saw a record subscription of N2.53 trillion, highlighting a substantial increase in investor appetite for government securities.

This was particularly notable given the challenging macroeconomic environment, including high inflation and the ongoing adjustments to interest rates by the CBN.

In comparison to the previous T-bill auction on November 20, 2024, there were significant shifts in both the amount offered and the level of demand across various tenors.

The December auction offered a total of N583.25 billion, across three different T-bill tenors: 91-day, 182-day, and 364-day bills. In contrast, the November 20, 2024, auction had a much larger offer of N610.8 billion. Despite the smaller amount on offer in December, investor interest soared, especially for the longer-dated securities.

This surge in demand for Treasury Bills comes on the heels of a recent policy adjustment by the Central Bank of Nigeria. Last month, the Yemi Cardoso-led Monetary Policy Committee (MPC) raised the benchmark interest rate for the sixth time this year by 25 basis points, bringing the rate to 27.50%. This aggressive tightening, aimed at curbing persistent inflation, has resulted in a corresponding increase in T-bill yields compared to previous years.

182-Day T-bill: Steady demand amidst inflationary pressures 

 364-Day T-bill: Record-breaking subscription 

The large demand for the 364-day T-bill suggests that investors are increasingly seeking higher returns on longer-term government debt in response to persistent inflationary pressures. The sharp rise in subscriptions is also reflective of the broader shift in investor strategy, as many seek to lock in higher rates amidst the elevated risk premium associated with longer-dated securities.