CBN offers one-year treasury bills above inflation rate

The Central Bank of Nigeria (CBN) on Thursday said it sold one-year treasury notes at 18.69 per cent, above inflation rate for the second consecutive time in a bid to maintain positive yield and attract investors, Reuters reported.

The CBN said it raised N83.16bn by issuing the one-year bill, which it had sold at a yield of 18.55 per cent at its previous auction on March 15.

The Federal Government forecasts a budget deficit of N2.36tn in 2017, half of which it aims to fund through domestic borrowing. It has been trying to keep costs down as it grapples with the country's first recession in 25 years amid galloping inflation.

Annual inflation rate fell for the first time in 15 months to 17.78 per cent in February but remained outside the CBN single-digit target.

It raised a total of N134.96bn from a treasury bill auction on Wednesday.

Outstanding total debt rose to N17.4tn last year from N12.6tn in 2015 and is set to increase further. The Federal Government is planning to increase public spending by almost 20 per cent this year, funded through borrowing.