Rates to moderate on N107.46bn, FAAC inflows 

Money market rates are expected to trade on moderate levels following anticipated inflow of treasury bills worth N107.46 billion as well as Federation Allocation Committee (FAAC) funds.

Dealers said the treasury bills will fall within the tenors of 91-day bills worth N18.12 billion;182-day bills worth N39.34 billion; and 364-day bills worth N50 billion and  will mature on Thursday, 23 June.

“We expect the maturities, coupled with anticipated FAAC inflows, to boost financial system liquidity and thereby moderate interbank rates,” dealers from Cowry Assets Management Limited wrote in a note to investors.

Meanwhile, yields on Nigeria’s naira-denominated bonds rose across the board at an auction on Wednesday, where about N112 billion ($563 million) worth of paper maturing in 2036, 2026 and 2020 was sold, the Debt Management Office (DMO) said last week.

The office said it had sold N50 billion of 2036 paper at 14.98 percent at Wednesday’s auction, compared with 13.90 per cent at the previous auction last month.

It also sold N40 billion of 2026 debt at 14.40 percent, against 13.74 percent, and N22 billion of the 2020 debt at 14.20 per cent against 13.24 per cent.

Dealers said the yields reflected a rise in inflation, which hit a six-year high of 15.58 percent in May.

“Many investors were pushing for higher yields at the auction to reflect the higher inflation figure released recently, which was above the prevailing interest rate in the market,” one trader said.

Investors’ bids had demanded yields ranging between 10 and 17 percent for all the debt on offer.