NOFR Holds Steady as Money Market Liquidity Eases to N5.8trn
The Nigerian Overnight Rate (NOFR) steadied as the banking system’s surplus liquidity narrowed following the settlement of the April bond auction.
In the absence of significant funding pressures, money market rates were little changed amid a liquidity-heavy financial system, without a midweek Treasury bill auction.
Banking system liquidity opened on Wednesday with a surplus of ₦5.79 trillion, but was ₦1.99 trillion shy of its prior session’s opening balance of ₦7.78 trillion.
Analysts at AIICO Capital Limited, in a note, said this decrease was mainly driven by a ₦276.79 billion outflow settled in an auction held early in the week.
Meanwhile, deposit money banks’ inflows into the Central Bank of Nigeria (CBN) Standing Deposit Facility (SDF) reached ₦5.30 trillion.
The Nigerian Interbank Offered Rate (NIBOR) trended downward across most tenors on Wednesday, reflecting surplus liquidity conditions in the banking system.
In the money market, rates were broadly mixed, as the Overnight rate eased by 4bps to 22.11%, while the Open Repo (OPR) rate held steady at 22.00%.
In the Treasury Bills secondary market, performance was largely bullish, with yields declining across most tenors. Consequently, the average T-Bills yield edged down by 2 basis points to 17.47%, supported by sustained investor demand and selective buying interest across the fixed-income market.
