The Federal Government through the
Central Bank of Nigeria is set to borrow the sum of N245.18bn ($773.44m)
via the issuance of Treasury bills with maturities ranging between
three months and one year on Wednesday (today).
According to the CBN Treasury bill
issuance calendar, it will issue N45.18bn in 3-month debt, N80bn of
six-month paper and N120bn of one-year bills in a Dutch auction.
Indicative rates for the auction are 16
per cent for three-month, 18 per cent for six-month and 18.5 per cent
for one-year bills.
The auction’s results will be published the day after the sale.
According to a Reuters report, yields on
fixed income securities have been rising in recent months with the
central bank mopping up naira liquidity to try to lure back foreign
investors who sold naira assets following the plunge in the price of
oil.
The CBN’s Monetary Policy Committee had
last Tuesday raised the Monetary Policy Rate by 200 basis points from 12
per cent to 14 per cent to help fight inflation, which hit a 10-year
high of 16.5 per cent in June.
Meanwhile, the naira closed at 310.50
against the dollar at the interbank market on Tuesday, firmer than
previous close of 315.50, Thomson Reuters data showed.
The local currency traded $23m at 280.50 just after the interbank market opened at 316.50.
One trader attributed the N280.50 rate to a dollar resale on the spot market of outright currency forwards sold by the CBN.
At the parallel market, the naira closed flat at 382 per dollar on Tuesday.
The naira had dropped to 382 against the
United States dollar at the parallel market on Monday, down from the
380 it closed on Friday.
The naira has been under persistent
pressure as dollar scarcity continues to weigh on the local currency at
both the parallel and interbank forex markets.
Economic and financial experts said inadequate forex liquidity at the interbank market was taking a toll on the parallel market.
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