Interbank Rates Fall as Inflows Keep Liquidity Strong
In the money market, interbank rates fell further on Wednesday as inflows from matured instruments pushed liquidity balance in the financial system higher again.
The liquidity in the banking system sustained its upward momentum and expanded by 27% to begin the day with a surplus balance of N803.68 billion, TrustBanc Financial Group said in a post.
The Nigerian Interbank Offered Rate (NIBOR) declined across all maturities, indicating sufficient liquidity within the banking system, Cowry Asset Limited said in a note.
The short-term interest rates have been in decline since the beginning of the week due to a flood of inflows. The trend kept banks away from the standing lending facility, where the rate has been adjusted above 32% due to the central bank interest rate hike.
Investment firms said in their separate notes that interbank liquidity increased further today. Data from the FMDQ platform confirmed that interbank rates relaxed further, with the overnight policy rate (OPR) dropping by 20 bps to 26.36% and the overnight rate (O/N) decreasing by 40 bps to 26.71%.
In the absence of significant pressure in the money market, analysts have predicted that interbank rates would continue to sink throughout the week. #Interbank Rates Fall as Inflows Keep Liquidity Strong NGX Rallies Intraday as Investors Take Positions in Access, FBNH
