Interbank rates in the Nigerian money market continued their downward trend on Wednesday, driven by increased liquidity from matured financial instruments.
According to Cowry Asset Limited, the Nigerian Interbank Offered Rate (NIBOR) declined across all maturities, signaling robust liquidity within the banking sector. Short-term interest rates have been falling consistently since the beginning of the week, supported by substantial inflows into the system.
This liquidity surplus has reduced banks’ reliance on the standing lending facility, where rates have been adjusted to over 32% following the central bank’s recent interest rate hike. Investment firms noted in separate reports that interbank liquidity strengthened further on Wednesday.
Data from the FMDQ platform corroborated the trend, showing a 20 basis point drop in the Overnight Policy Rate (OPR) to 26.36% and a 40 basis point decline in the Overnight Rate (O/N) to 26.71%.
With limited pressure in the money market, analysts anticipate that interbank rates will continue to decline through the remainder of the week.
