Market Anticipates N404b Maturing Bills amid Liquidity Ease

By Dipo Olowookere

The treasury bills market will be anticipating the government’s instruments worth N404.32 billion maturing this Thursday.

These T-bills will be maturing via the secondary market amid expectations of Open Market Operations (OMO) sales by the Central Bank of Nigeria (CBN) to mop up excess liquidity.

“Howbeit, we expect relative ease in the financial system liquidity with resultant moderation in interbank rates,” analysts at Cowry Asset said in their weekly market report.

Last week, the apex auctioned treasury bills worth N107.05 billion via the Primary Market Auction (PMA). The stop rates for the auctioned T-bills were mostly flattish across maturities: the 91-day and 182-day stop rates remained flat at 10 percent and 10.50 percent respectively; however, the 364-day stop rate fell to 11.49 percent from 11.51 percent.

Also, N496.26 billion worth of T-bills were sold via the secondary market. The outflows were offset by N608.60 billion in matured T-bills.

Indicative of liquidity surplus was the Standing Deposit Facility (SDF) worth N512.95 billion which outweighed the Standing Lending Facility (SLF) worth N47.19 billion.

Hence, NIBOR moderated for most tenor buckets amid sustained financial liquidity ease, in line with expectations: NIBOR for 1 month, 3 months and 6 months tenor buckets declined w-o-w to 12.63 percent from 12.84 percent, 13.15 percent from 13.39 percent and 14.41 percent from 14.55 percent respectively; however, NIBOR for overnight tenor bucket rose to 16.75 percent from 9.95 percent.

Elsewhere, NITTY fell for all maturities tracked amid renewed bullish activity: yields on the 1 month, 3 months, 6 months and 12 months maturities moderated to 10.75 percent from 11.60 percent, 10.99 percent from 11.81 percent, 12.15 percent from 12.66 percent and 12.60 percent from 13.36 percent respectively.