By Cowry Asset
In the just concluded week, the Central Bank of Nigeria (CBN) sold treasury bills via Open Market Operations (OMO) totalling N122.83 billion, viz: 100-day bills worth N0.0049 billion, 106-day bills worth N3.37 billion, 181-day bills worth N34.81 billion, 191-day bills worth N20.47 billion and 196-day bills worth N64.18 billion.
These auctions were partly offset by matured OMO securities worth N14.13 billion.
Consequently, NIBOR rose for all of the tenor buckets amid financial system liquidity strain as auctions outweighed maturities.
NIBOR for the Overnight funds, 1 month, 3 months and 6 months tenor buckets rose w-o-w to 36.88% (from 26.03%), 21.24% (from 19.99%), 21.60% (from 21.46%) and 23.02% (from 22.91%) respectively.
Elsewhere, NITTY rose for most of the maturities amid renewed profit taking activities – yield on the 1-month, 3-month and 6-month maturities rose to 20.70% (from 18.63%), 17.83% (from 17.04%) and 19.10% (from 18.14%) respectively.
However, for the 12 month maturity, NITTY fell to 17.84% (from 18.09%).
This week, there will be Treasury Bills (T-Bills) auction via primary markets worth N133.79 billion viz: 91-day bills worth N32.40 billion, 182-day bills worth N35.00 billion and 364-day bills worth N66.39 billion.
Furthermore, there would be maturing T-Bills and Open Market Operations (OMO) totalling N174.33 billion, viz: 91-day bills worth N32.40 billion; 154-day bills worth N0.096 billion, 163-day bills worth N0.22 billion, 167-day bills worth N0.48 billion, 181-day bills worth N0.20 billion, 182-day bills worth N25.51 billion, 358-day bills worth N49.04 billion and 364-day bills worth N66.39 billion.
As a result, we expect some pressure on the financial system liquidity with resultant increase in rates.
Adedapo Adesanya