The Central Bank of Nigeria (CBN), on behalf of the Federal Government, is set to raise N1.13 trillion in treasury bills (TBs) in the second quarter of this year compared to the N926 billion it raised from the debt instrument source in the corresponding quarter of 2022.
According to information posted on the apex bank’s website on the debt instrument plan, the TBs comprised 91-days, 184-days and 364-days from which it planned to raise N23.669 billion, N34.704 billion and N1.07 trillion respectively. The bills are rollover of maturing bills for the corresponding period.
Available data on Federal Government of Nigeria’s (FGN’s) TBs accruals in January & February this year showed that the government raised a total of N540.9 billion, up from the N342.6 billion it raised in the corresponding period of last year.
In recent weeks, the FGN treasury bills rates have been rising with the 91-days TBs going for 3% while the 184-days and the 364-days TBs rising to 3.24 and 9.9% respectively.
Considered as one of the most credible debt instruments investors can invest in based on their low risks, TBs have become one of the major monetary instruments being used by the apex bank to mop up liquidity from the economy and by implication, the surging inflation rate in the country.
In addition to using it to mop up excess liquidity from the economy, the CBN can also encourage higher yields for the TBs as a strategic monetary policy measure to tackle the rising inflation rate for improved performance of the economy.
Statistics from the apex bank indicated that in 2022, the Federal Government raised N3.9 trillion from treasury bills issuance.
TBs are short-term debt instruments usually issued by the CBN to aid the government’s fiscal target of bridging budget deficit gaps on yearly basis
