Money Market Rates Decline as Liquidity Surplus Hits N1.53trn

Money Market Rates Decline as Liquidity Surplus Hits N1.53trn

Money market rates dipped further as liquidity balance in the financial system soared above N1.5 trillion. The liquidity level stay strong in the absence of outflows as neither Debt Management Office, nor the Central Bank of Nigeria auctioned borrowing instruments in the week.

With the absence of outflows relation to cash reserve maintenance, and primary market activities, deposit money banks were excused from significant demand for liquidity to fund their respective operations. The kept money market liquidity in net long positions in the last two days.

Consequently, the short term benchmark interest rates declined below 27% apiece, analysts said they expect funding rates to remain at the current level. On Thursday, the amount accessible by market players at the money market climbed by 2% to open the day at N1.53 trillion, investment firm TrustBanc Financial Group Limited said in a report.

The Nigerian Interbank Offered Rate (NIBOR) declined across most tenors, except for the overnight rate, which edged up by 2basis points to close at 26.86%. Data from the FMDQ platform showed that the Open Repo (OPR) fell by 8bps to close at 26.42%.Also, and Overnight (O/N) rates declined by 8bps to 26.88%.

Analysts said interbank rates are likely to remain stable barring unexpected liquidity withdrawals. The Nigerian Interbank Treasury Bills True Yield (NITTY) rose across most tenors, while the secondary market for Nigerian Treasury Bills experienced a bullish trend, driven by strong investor demand that pushed the average yield down by 0.03% to 19.38%. #Money Market Rates Decline as Liquidity Surplus Hits N1.53trn

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