The Central Bank of Nigeria has disclosed that the federal government raised N2.72 trillion through Nigerian Treasury Bills in the first two months of 2025, marking an 8.6% decline from the N2.97 trillion raised during the same period in 2024.
The CBN is tightening monetary policy with higher interest rates and large NTB auctions to control inflation and stabilize the exchange rate.
Its ‘Government Securities’ data shows that while it initially targeted N1.52 trillion, investor subscriptions reached N9.68 trillion, with the bank ultimately raising N2.72 trillion.
Nigerian Treasury Bills, also known as T-Bills, are short-term debt securities issued by the government to cover budget deficits and finance projects. In Nigeria, the CBN issues NTBs on behalf of the federal government.
By tightening monetary policy through higher interest rates and large NTB auctions, the CBN seeks to curb inflation and stabilize the exchange rate, promoting economic stability.
The Monetary Policy Committee raised the interest rate by 870 basis points to 27.50% from 18.75% in 2024 to address rising inflation.
This led to an equal increase in the yields of Treasury bills compared to last year.
However, in its first meeting of 2025, the MPC kept the interest rate at 27.50% to ease the payment burden.
Meanwhile, the CBN has been reducing elevated discount rates on NTBs due to strong demand and the benchmark interest rate surpassing headline inflation.
