Limited maturing treasury, OMO bills to keep liquidity low

THERE are anticipations of bearish money market action as financial sector liquidity may come under increased strain due to the limited maturing treasury and Open Market Operation (OMO) bills.

Last week, the funding rate hovered around double-digit all week in the absence of any major inflows. At the close of trading on Friday, the interbank rates fell slightly.

The Open Repo rate (OPR) declined to 13.50 by -7.98 per cent (W-o-W) and the overnight rate (O/N) fell to 13.67 by -8.87 per cent (W-o-W).

Despite the selloffs all week, dealers said the Nigerian treasury bill closed slightly bullish on Friday. The average benchmark yield fell marginally by -0.12 percent (W-o-W) to 8.21.

Like the NTB market, the OMO bill’s closed bullish with the average benchmark yield declining by -0.19 per cent (W-o-W) to settle at 10.35

The market moved bearish during all trading sessions last week with the average benchmark curve pivoting outward.

On Friday, the average benchmark yield rose by 125bps (W-o-W) to 13.18 per cent from 13.02 per cent recorded in the previous week.

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