Federal Government Of Nigeria Plans To Raise N62Billion Through Tbills

Federal Government of Nigeria (FG) through the central bank, has made plans to acquire a total sum of N62.43 billion ($171m) through an auction of Treasury bills next Wednesday, 16 August 2017.The bank explained that it plans to offer N32.43 billion in three-month paper and N30 billion on a six-month bill, while the results of the auction will be announced on the same day and allotment letters issued for successful bids on Thursday, 17 August, 2017. In a statement, the bank said all money market dealers should submit bids through the CBN S4 WEB INTERFACE between 9:00 am and 11:00 am next week Wednesday, 16 August. The CBN further said that each bid must be in multiple of N1,000 subject to a minimum of N50,001,000 and authorized money market dealers are to submit multiple bids.The treasury bills are known to provide short-term funding for the government and control money supply in the economy. Financial experts in the country have however raised concerns over the continuous sales of T bills at yields higher than the country’s inflation rate, they strongly believe the Central bank of Nigeria will pay between 13.42 Р18.54 per cent as a strategy to lure investors and attract dollar inflows. Traders have suggested that the sale of Treasury bills left some banks short of cash, forcing them to scramble for funds to pay for their T/bills and dollar purchases from the interbank market; regrettably, that reaction inadvertently pushed up the cost of borrowing amongst lenders.Photo Credit: Getty

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