The Central Bank of Nigeria (CBN) held a treasury auction on Wednesday to try to lure foreign investors.
According to Reuters, traders said the central bank asked them to increase their rates at a bills auction on Wednesday compared with rates that the bank paid at the last sale in July.
The move led to a spike in yields on the one-year treasury bill which rose to 12 per cent on Wednesday from around 10 per cent on Friday. Traders said the central bank wanted to offer bills at higher rates to attract foreign investors to boost liquidity on the currency market, which would help support the naira. Banking stocks fell 1.26 per cent on Wednesday, to help drag the main share index of the Nigerian Stock Exchange to more than two-year low as negative sentiment persisted on the stock market.