Investors bidding for 363-day tenor OMO bills at a spot rate of 22.34% for one-year securities were able to purchase them from the Central Bank of Nigeria (CBN) at the Wednesday primary market auction.
After the rate modification for the monetray policy, OMO bill market rates stayed high. This is an effort to draw international investors into the Nigerian economy despite the nation’s excessive reliance on imports in the face of ongoing US dollar scarcity.
The CBN put N500 billion up for auction with a range of conventional maturities. CardinalStone Securities Limited informed investors in a note that bids totaled N73 million for the 174-day instrument and N903.05 billion for the 363-day instrument.
The OMO bill auction results, however, showed that there was no bids for the 90-day instrument at the auction condcuted. The investment firm said total sales and stop rates were N73 million at 19.64% for the 174-day instrument.
The CBN sold N499.27 billion worth of 363 day OMO bills at 22.34% to market participants at the auction. In the secondary market, the average yield dipped by 1bp to 21.5% in the OMO bills segment due to thin transaction recorded.
Meanwhile, interbank rates diverged as the open repo rate declined by 9 basis points while the overnight lending rate advanced by 192 basis points to close at 31.23% and 32.00%, respectively.
