Interbank rates fell as signs of liquidity shined clearly in the money market. Despite the lack of major inflows, the financial system’s liquidity pressures lessened for the first time this week.
A series of auction sales and bank funding needs were recognized as significant barriers to the financial system’s liquidity boost. The Central Bank recently held Treasury and OMO bill auctions, which debited the system’s liquidity position.
Banks’ activities at the standing lending facility have been hampered by an increased rate on short-term borrowings. Yesterday, the Nigerian interbank offered rates reduced across most maturities, according to Cowry Asset Limited, reflecting improving money market conditions.
Key money market rates such as the Open Repo Rate and Overnight Lending Rate decreased, according to data from the FMDQ, in the absence of funding pressure in the financial system.
Investment firms reported that the Open Repo Rate and Overnight Rate decreased by 23bps and 11bps to 31.00% and 31.53%, respectively on Thursday,
Depending on the direction, market analysts said movement in short term benchmark rates affects returns on money market funds and deposits.
