Investors’ Appetite Spikes As Treasury Bills Subscription Hits N3.44trn

The Central Bank of Nigeria (CBN), recorded strong investor appetite at its Nigerian Treasury Bills primary market auction on Wednesday, with total subscriptions rising to N3.44 trillion.

This is far above the offer amount and the highest level seen since December 2024, as investors moved to lock in elevated returns.

At the auction, the apex bank offered a total of N1.15 trillion across three tenors: N150 billion for the 91-day bill, N200 billion for the 182-day bill, and N800 billion for the 364-day bill.

Demand was strongest at the long end of the curve, as investors sought exposure to the one year instrument, with bids coming in at about four times the size of the offer. Despite the heavy demand, the CBN sold a total of N1.06 trillion across the three maturities.

The last time the market witnessed such a strong appetite was on December 4, 2024, when total subscriptions exceeded N5 trillion amid heightened inflationary pressures and elevated interest rates.

Market activity suggested that participation in the Nigerian Treasury Bill market has remained elevated, with subscription levels consistently above N1 trillion at primary auctions since December 2025. Analysts at Meristem attributed the sustained interest to investors positioning to benefit from rising interest rates.

Yields at the auction were mixed. Short dated instruments recorded marginal increases, while the one-year bill eased slightly but continued to offer attractive returns. The true yield on the 91-day bill rose to 16.50 per cent, while the 182-day bill climbed to 18.17 per cent from 17.99 per cent at the previous auction. In contrast, the true yield on the 364-dayy bill declined to 22.49 per cent from 22.65 per cent, though it remained elevated.

The 2026 fiscal year is projected to have a budget deficit of N23.85 trillion, prompting the federal government to rely heavily on domestic borrowing, as access to international capital markets remains costly for emerging economies.

This strategy is reflected in the first-quarter 2026 issuance calendar, which showed planned borrowing of N7.55 trillion in the first three months of the year. The increased supply of government securities has continued to put upward pressure on yields as the government competes for limited investor liquidity.

Beyond fiscal pressures, the Central Bank is also keeping rates elevated to curb inflation and stabilise the naira. By keeping yields attractive, particularly on the one-year instrument above 22 per cent, the CBN aims to mop up excess liquidity and draw foreign portfolio inflows that can support foreign exchange supply.