The Debt Management Office (DMO) sharply limited its acceptance of Nigerian Treasury Bills at the October 14 auction, rejecting approximately 74% of the N1.032 trillion in total subscriptions and allotting only N269.06 billion—about 26.07% of bids received.
For the 364-day instrument, the DMO allotted N220 billion out of N982.21 billion subscribed, while the stop rate rose five basis points to 15.90% from 15.85%, its first increase since August. The Central Bank of Nigeria conducted the auction on behalf of the Federal Government, with analysis from the Financial Markets Dealers Association (FMDA).
The CBN offered N450 billion across three tenors, compared with N900 billion at the October 7 auction. Total subscriptions reached N1.032 trillion, while allotments stood at N269.06 billion, approximately 40% below the advertised offer.
Demand remained concentrated in the longest tenor, which accounted for 95.15% of total subscriptions.
- The 364-day bill attracted N982.21 billion in bids against N350 billion offered, with N220 billion allotted at a stop rate of 15.90%. - The 182-day bill received N30.10 billion against N50 billion offered, with N29.54 billion allotted at an unchanged 15.80%. - The 91-day bill drew N19.91 billion against N50 billion offered, with N19.52 billion allotted at an unchanged 15.50%.
Total subscriptions were 2.29 times the N450 billion offer, up from 1.97 times at the October 7 auction, although aggregate demand fell roughly 42% from that sale. Roughly N763 billion in bids went unallotted, almost all of it in the one-year tenor. Bids for the 364-day bill ranged from 15.00% to 18.18%, placing the accepted stop rate 228 basis points below the highest bid. FMDA interpreted the restricted allotment as an attempt to resist upward pressure on borrowing rates, though the results did not explain individual rejections.
The five-basis-point rise interrupted a decline that had continued since August, when the one-year rate reached 17.59%. The rate fell to 15.89% on September 23, after the CBN's Monetary Policy Committee cut the benchmark rate by 350 basis points to 23%, and eased further to 15.85% on October 7, when investors bid N1.683 trillion for the one-year bill and the DMO allotted N968.47 billion against N900 billion offered.
