Federal Government raises N136bn in T-bills at higher yields

  The Federal Government  sold N136.24bn ($684.67m) last week Thursday in Treasury bills with maturities from three months to one year at its first auction of the year on Wednesday. The T-bills were at higher yields.The bank sold N55.4bn of three-month paper at four per cent, up from 3.62 per cent, at a sale on December 23.

It also sold N25bn of six-month debt at 6.99 per cent against 6.19 per cent, and N55.84bn of one-year paper at 8.05 per cent compared with 7.45 per cent.

Nigeria issue treasury bills twice-monthly to fund the government budget deficit and manage liquidity in the banking system.

The Debt Management Office had in December last year stated that the country was in a strong standing to raise funds from the bond market to finance any deficit from the 2016 budget if it is so required.

The agency stressed that the Nigerian bond market had the capacity to bridge the funding gap in the budget.

The Director-General, DMO, Dr. Abraham Nwankwo, had said the slump in crude oil prices in the international market had made a deficit budget inevitable this year, adding that the DMO was prepared to borrow on behalf of the government to fund the deficit.

Excerpts from ThePunch