Interbank rates fell by around 300 basis points, or 3% each, as liquidity levels in the financial system remained strong despite outflows from open market operations (OMO) bills issued to investors yesterday.
The Central Bank of Nigeria (CBN) sold ₦758 billion of the long-dated OMO bills at the primary market auction on Tuesday, out of a total of ₦500 billion offered in three tenors.
Short-term benchmark rates responded positively to the financing level in the absence of major market forces. According to data from the FMDQ platform, funding rates have dropped significantly.
Interbank rates: the open repo rate and overnight rate contracted by 298 bps and 295 bps, respectively, to settle at 22.73% and 23.40%, respectively, as system liquidity remained robust despite OMO auction settlements.
The Overnight Nigerian interbank offered rate (NIBOR) dropped by 458bps to 20.67% on Wednesday, Cowry Asset Limited said in a note on Wednesday.
Analysts said local deposit money banks with excess liquidity sought lower borrowing rates in the money market.
