Interbank rate slumps as CBN mops up N195b via OMO sales

Interbank rate slumps as CBN mops up N195b via OMO sales

By Tunde Osho

Nigeria’s interbank lending rate dropped slightly following the Central Bank of Nigeria, CBN’s continued intervention to mop up liquidity to keep the financial system stable.

At the market, weekend, there were inflows from Open Market Operations (OMO) maturities as well as bond coupon payment. These helped reduced the impact of outflows for OMO sales carried out by the apex bank yesterday.

A total of N194.7 billion worth of T-bills were sold by the CBN at the market.

A breakdown showed that N31.36 billion worth of the 91-day bill was sold at 12.60 percent, while N163.34 billion worth of the 203-day instrument was cleared at 14.40 percent.

The 203-day bill saw a huge subscription from investors as N100 billion worth of the instrument was offered for sale by the apex bank.

However, the 91-day was undersubscribed as the central bank could only get N31.36 billion from the N50 billion offered to market players.

Generally, the treasury bills market was slightly bullish and as usual, the market is expected to be marginally bearish today as lenders would be looking to fund retail forex bids.

Meanwhile, the Open Buy Back (OBB) rate declined to 5.25 percent on Thursday from 6.17 percent, while the overnight rate fell to 5.75 percent from 6.50 percent.