Investor demand for Nigerian Treasury Bills (T-Bills) surged during the November 19, 2025, auction. Market participants placed bids totalling N1.23 trillion for the 364-day paper, far exceeding the N450 billion offered by the Central Bank of Nigeria (CBN).
This aggressive bidding signals a clear market strategy: investors are rushing to “lock in” currently high yields before an anticipated drop in interest rates in 2026.
Auction Highlights: High Demand, Stable Rates
Despite the massive influx of liquidity, the CBN maintained the status quo on stop rates. While the demand was fierce, rates for the 91-day, 182-day, and 364-day tenors remained unchanged from the previous auction.
Auction Results Breakdown (November 19, 2025)
| Tenor | Offer Amount | Allotted Amount | Stop Rate | True Yield |
| 91-Day | N/A* | N33.81 Billion | 15.30% | 15.918% |
| 182-Day | N/A* | N26.41 Billion | 15.50% | 16.809% |
| 364-Day | N450 Billion | N1.03 Trillion | 16.04% | 19.104% |
> Note: The reported total allotment across all tenors was N1.63 trillion, highlighting significant excess liquidity in the financial system.
The Strategy: Why the Rush?
Analysts suggest that the intense competition for the one-year (364-day) bill is driven by the expectation that the monetary policy environment will shift in early 2026.
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Inflation is Cooling: Inflation dropped to 16.05 per cent in October (down from 18.02 per cent in September).
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Anticipated Rate Cuts: As inflation falls, the CBN is expected to lower interest rates in 2026.
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Locking in Returns: Investors are buying long-term bills now to secure ~19 per cent true returns before rates likely soften next year.
Market Sentiment vs. CBN Action
Many analysts expressed surprise that the stop rates did not drop, given the overwhelming demand and falling inflation.
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Comparison to Nov 5: The November 19 auction saw even higher demand for long-term paper than the November 5 auction (which saw N1.135 trillion in bids).
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Stability over Softening: While the November 5 auction saw a slight rate drop (10 basis points), the CBN chose to hold rates flat this time.
Outlook: What to Expect
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Short-Term: Fierce bidding is expected to continue through December as institutions adjust their portfolios and balance sheets for the year-end.
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Long-Term (2026): With inflation trending downward, yield softening is widely expected in Q1 2026.
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Investment Choice: For now, the one-year T-Bill remains the preferred “risk-free” asset for capital preservation, offering returns that currently beat the falling inflation rate.
