Money Market Rates Steady on N6.2trn Liquidity Surplus
Excess liquidity in the financial system, totalling N6.2 trillion, kept short-term money market rates steady as banks continue to place funds with the Central Bank.
The robust financial liquidity condition was sustained amidst the Treasury bills auction, where the Central Bank of Nigeria (CBN) offered N700 billion for subscription across standard tenors.
Ahead of auction settlement, system liquidity in the banking system printed at ₦6.62 trillion, reflecting a marginal improvement of ₦8.56 billion from the previous open of ₦6.61 trillion, AIICO Capital Limited said in a note.
The surplus balance was mainly driven by ₦6.19 trillion Deposit Money Bank placements at the CBN’s Standing Deposit Facility window in the absence of significant primary market action.
Nigerian Interbank Offered Rates closed on a mixed note on Wednesday, with the overnight rate easing 2bps to 22.27%, reflecting improved system liquidity, Cowry Asset Limited said.
Funding costs were equally divergent, as the Overnight rate edged up 4bps to 22.17% while the Open Repo rate remained unchanged at 22.00%.
However, the Nigerian Overnight Financing Rate (NOFR) remained steady at 22.00%, AIICO Capital Limited told investors. The market expects liquidity levels to moderate slightly on Thursday following an outflow of ₦731.75 billion from the settlement for Treasury bills sold by the Apex Bank.
In the Treasury Bills secondary market, yields fell across tenors, with the 1-month, 3-month, 6-month, and 2-month maturities dropping 37bps, 7bps, 8bps, and 4bps, respectively.
Overall, the average NT-Bills yield fell 1 bp to 17.47%, reflecting increased investor demand and a broadly positive tone across the fixed-income space. Capital Discipline: Access Holdings Reduces Equity Stakes in Foreign Subsidiaries
