**As Money Market Rates Drop 2.42%
By Modupe Gbadeyanka
The Central Bank of Nigeria (CBN) on Tuesday carried out the sale of treasury bills via the Open Market Operations (OMO).
This was the control excess liquidity and at the end of the exercise, the apex bank succeeded in mopping up N325.93 billion from the system.
A breakdown of the OMO sale showed that the central bank raked N41.47 billion from the 26-day bills at 11.05 percent, while N194.46 billion was realized from the 205-day paper at 12.15 percent.
Business Post reports that the exercise was not largely subscribed to as investors traded cautious because of the outcome of the Monetary Policy Committee (MPC) meeting yesterday. The CBN announced it was retaining the rates at 14 percent for the 11th consecutive time.
Generally, the mood at the T-bills market yesterday was negative as indicated by the average yields, which increased slightly by 0.09 percent to close at 11.93 percent.
The mood is expected to remain at this level as investors anticipate another OMO exercise from the CBN before the end of this week.
Meanwhile, at the money market yesterday, the average rate depreciated by 2.42 percent to settle at 7.59 percent.
While the Open Buy Back (OBB) rate dropped to 7.17 percent from 9.43 percent, the Overnight (OVN) rate decreased to 8 percent from 10.57 percent.
Business Post reports that the drop in the money market rates was mainly influenced by the market liquidity level yesterday, which remained high despite the mop up of over N200 billion by the central bank through the sale of OMO bills.
Adedapo Adesanya