Naira Defense: CBN Faces N1.01 Trillion Interest Expense from Q1 NTB Auctions
The Central Bank of Nigeria (CBN) has adopted an assertive stance in defending the naira, projecting a substantial interest payout of approximately N1.01 trillion. This projection stems from an analysis of the Nigerian Treasury Bills (NTB) auction data for the first quarter of 2024, revealing a robust subscription trend amidst escalating rates. Throughout the quarter, investors demonstrated strong interest in government securities, as evidenced by a staggering total subscription of N21.17 trillion. Despite the high demand, the CBN exercised caution in liquidity management, with total sales amounting to approximately N5.64 trillion. The most recent auction on March 27, 2024, witnessed significant subscriptions across various tenors, with total sales surpassing N1.19 trillion. Notably, the stop rate for 182-day bills saw a substantial increase to 17%, reflecting the CBN's selective bidding process. The quarter also witnessed a gradual rise in stop rates offered by the CBN, reaching pea…
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