By Dipo Olowookere
The treasury bills market maintained its bearish position on Tuesday as the Central Bank of Nigeria (CBN) sustained its aggressive OMO sale.
At yesterday’s session, the average treasury bills yields trended higher by 0.08 percent as investors offloaded some of their short tenured notes.
According to analysts at Zedcrest Research, this development further compressed system liquidity further to an estimated net negative position.
At the day’s OMO auction by the CBN, market players remained not committed to the exercise with the bank refusing to push the rates up as expected.
Of the N100 billion T-bills offered by the apex bank, investors only bided for N38.8 billion of the 177-day and 268-day bills offered, which were sold at 13.50 percent and 15.00 percent respectively.
Business Post reports that for the N20 billion worth of the 100-day paper offered by the central bank, no bid was received from market players and the bank consequently declared a ‘No Sale’.
“We expect rates to remain elevated with expectations for continued OMO intervention by the CBN,” Zedcrest Research said.
Meanwhile, rates in the money market trended 0.30 percent higher and are now at a 7-month high, with the Open Buy Back (OBB) and Overnight (OVN) rates closing at 65.00 percent and 70.92 percent respectively.
This is as the CBN maintained its mop up of system liquidity via a further OMO sale of about N39 billion, which has now pushed system liquidity to a net negative position of N45 billion as at COB on Tuesday. The rates are expected to remain elevated, with the CBN expected to maintain its spate of OMO interventions in the market.
