Treasury Bill Rate Closed Flat as Investors await MPC Decision
Treasury bill rate closed flat on Monday as fixed income securities investors await the outcome of the Central Bank of Nigeria (CBN) Monetary Policy Committee (MPC) meeting. Last week, activities at the Nigerian treasury bill secondary market traded on a bearish note, consequently, average yields expanded by 70 basis points.
Amidst the quiet trading activities, the Nigerian treasury bill benchmark curve was flattish today at 5.40% while the Federal Government of Nigeria (FGN) benchmark bond curve expanded by a basis point to close at 13.27%.
Fixed income investors are awaiting liquidity from maturing open market operations obligations tomorrow, which analysts expect to boost liquidity in the financial system.
However, the open market operations (OMO) benchmark curve expanded much further by 38bps to 9.01%, by market-close on Monday.
Tomorrow, there will be OMO maturities of N110 billion, which analysts at Chapel Hill Denham expect to bolster liquidity.
Meanwhile, funding rates in the money market, the Open Buy Back and the Overnight rates, opened the week on a positive note by shedding 1.5% and 1.75% respectively.
The lower funding rates trailed improvement in financial system liquidity which closed lower at a deficit of N355.2 billion on Monday against N577.6 billion on Friday.
Naira: Official Exchange Rate Falls 92.4% in 5-Year
“This was largely driven by a slowdown in repurchase agreement activities, which offset the sustained demand pressures in the Standing Lending Financing (SLF) window”, Chapel Hill Denham said.
In the currency market, the Nigerian local currency, naira, improved by 0.18% or 18 kobo against the USD to close at 411.25 in the Investor & Exporter (I&E) window.
However, in the parallel market, the local currency shed 0.21% or 21 kobo against the USD at 486.00 as external reserves extended its decline, closing at US$34.33 billion.
Treasury Bill Rate Closed Flat as Investors await MPC Decision
