Treasury Bills Rate Peaks At 10.0% on Sustained MPR

The decision of the Monetary Policy Committee, MPC, to retain key policy rates had a positive impact on the activities in the Treasury Bills market last week.

The week had started bearish as investors traded cautiously ahead of the MPC meeting. Thus, average T-Bills rate stood at 10.7 per cent last Monday. Bearish sentiment was sustained last Tuesday as MPC concluded its two-day meeting.

However, sentiment turned bullish on Wednesday and Thursday following MPC’s announcement to retain benchmark rate at 12.0 per cent. Average T-Bills rate settled at 10.0 per cent on Friday as against 8.5 per cent in the previous week.

“With the decision of the apex bank to keep key rates unchanged, we expect money market rates to remain determined by liquidity dynamics in the system,” said Afrinvest analysts.

The foreign exchange market in the week was also majorly driven by the outcome of the MPC meeting in which the committee decided to introduce greater flexibility in the pricing of foreign exchange at the interbank market while retaining a small window to fund critical transactions.