Overnight Rate Slightly Down as CBN Sells N100b OMO Bills

By Modupe Gbadeyanka

Yesterday, the overnight rate depreciated by a very small margin as the Central Bank of Nigeria (CBN) continued with its regular sale of treasury bills through the Open Market Operations (OMO).

The interbank lending rate, which closed on Wednesday at 15.75 percent, stood at 15.50 percent on Thursday.

In the same vein, the Open Buy Back (OBB) rate, which was at 14.83 percent on Wednesday, closed on Thursday at 14.67 percent.

The slight decline occurred as the apex bank mopped up about N100 billion from the banking system.

Result of the OMO auction yesterday showed that the central bank sold N3.12 billion worth of 91-day bill, while it raked N96.80 billion from the 224-day bill.

Business Post reports that while the 91-day bill cleared at 12.60 percent, the 224-day instrument was sold at 14.40 percent.

It was observed that a sizeable subscription was received for the 224-day bill, which had N100 billion worth on offer, while the 91-day bill recorded very low subscription from traders, N50 billion worth of the bill was auctioned by the apex bank.

Generally, the treasury bills market was slightly bullish yesterday and the trend is expected to continue today with inflows from FAAC payments expected to ease system liquidity.