Average Rate on Nigerian Treasury Bills Rises to 0.14%
In the fixed income market, average rates expanded by 4 basis points (bps) at the secondary Nigerian Treasury Bills (NTB) market to 0.14%.
However, amid N60 billion open market operations (OMO) sale by the Central Bank of Nigeria, the financial system liquidity opened slightly higher.
The financial system liquidity opened at N662 billion from N554 billion in the previous session.
Meanwhile, at the close of the market, the interbank money market rates bucked the decelerating trend witnessed since the start of the week.
Precisely, the Open Buy Back (OBB) and Overnight (OVN) rates rose significantly by 308bps and 337bps to 3.63% and 4.25%, respectively.
“For us, the provisioning for the bi-weekly retail FX auction by the CBN comes to mind as the key driver of the uptick in funding rates”, Chapel Hill Denham said.
The firm however stated that similar pattern is expected to play out next week, where rates will start the week benign, due to supportive liquidity, before expanding on Friday, on the back of the provisioning for retail FX auction.
Meanwhile, activities were mostly quiet in the secondary open market operations (OMO) segment as discount rates on the benchmark instruments closed flat at 0.28%.
Elsewhere, in the bond segment, the market traded slightly mixed, albeit with a bullish bias as investors accumulated long-duration bonds.
Precisely, yields dipped marginally by 1bp on average across the benchmark curve to close at 4.20%, thanks to the interest in short (-1bps to 1.28%), mid (-1bps to 4.56%), and long (-2bps to 6.04%) end of the curve.
In FX market, exchange rates were unchanged at N379.00, N380.69, N395.00 at the official, secondary market intervention sales and the I&E Window, respectively.
Elsewhere in the parallel market, pressures resumed on the local currency as Naira depreciate N5.00 or 1.05% against the US dollars to close at N475.00.