Rates to moderate on N193.17bn inflows

THERE are expectations in the money market  that there will be a moderation in the  interbank rates this week following financial inflows worth N193.17 billion comprising Open Market Operation (OMO) instruments worth N109.8 billion and T-bills worth N83.37 billion.

Dealers said, “We expect the Central Bank of Nigeria  to guide rates through interventions as we expect maturing OMO instruments of N109.8billion. In the secondary market, we expect the bullish performance to linger.

“T-bills worth N83.37 billion will mature via the secondary market; hence, we expect interbank interest rates to moderate further amid anticipated ease in financial system liquidity.”

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Meanwhile, in the secondary market, performance was bullish across all maturities as rates slid 33 basis points (bps) lower when compared week by week (W-o-W) to 10.4 per cent.

The bullish performance was on the back of the CBN’s pause from conducting OMO auctions despite elevated system liquidity.

Dealers said the 91-day instrument enjoyed the most buying interest with rates trimming 54bps. Similarly, rates on the 364-day and 182-day instruments edged 43bps and 2bps lower respectively

“We expect increased buying interest next this week following a rate cut by the US Fed which will stimulate foreign inflows from investors seeking high yielding emerging markets assets,” one dealer said.