Money market rates moved unevenly on Monday as sizable outflows tied to recent Central Bank auctions failed to create major strain within the system.
Data from FMDQ revealed that the overnight lending rate eased slightly as excess liquidity thinned following large OMO bill settlements. Despite the outflows, banks continued to channel funds into the Central Bank’s Standing Deposit Facility, indicating that liquidity conditions remained generally comfortable.
Market players expect Wednesday’s Treasury bills auction, where ₦700 billion will be issued across standard maturities, to further mop up surplus liquidity. Analysts predict strong investor appetite as banks look to funnel idle balances into short-term assets to boost returns.
System liquidity began the session with a surplus of ₦3.9 trillion, a steep drop of about ₦2.3 trillion from the previous level. Total liquidity had recently exceeded ₦6 trillion, buoyed by rising SDF placements from cash-heavy lenders.
The financial system also received support from a ₦254.8 billion bond coupon payment, which injected fresh liquidity across the market.
Funding costs reflected a mixed performance as the overnight lending rate fell by six basis points to 24.86%, while the Open Purchase Rate held steady.
In the secondary Treasury bills market, yields moved in alternating directions across maturities. Nonetheless, the market closed with a two-basis-point decline in the average yield to 16.96%, signaling sustained investor interest and positive sentiment toward government debt.
