T-Bills Yield Gains 0.08% on Absence of Liquidity Mop up by CBN

By Dipo Olowookere

The absence of an OMO auction by the Central Bank of Nigeria (CBN) on Tuesday saw the secondary market for treasury bills closing bearish.

It was observed that the apex bank failed to sell OMO bills to investors since the last exercise held on July 4 despite the significantly buoyant system liquidity levels yesterday.

However, investors are anticipating an OMO exercise tomorrow as treasury bills worth N92 billion on that day.

Business Post reports that at the close of business, the average yield rose by 0.08 percent to settle for the day at 11.53 percent.

Only the 6-month maturity depreciated yesterday and this was by 0.04 percent to finish at 12.16 percent, while the one-month tenor closed flat to settle at 9.79 percent.

The 3-month bill appreciated by 0.34 percent to end at 11.12 percent, while the 12-month maturity went up by 0.03 percent to close at 13.05 percent.

Meanwhile, rates in the money market remained stable, as there were no significant outflows from the system.

Consequently, the Open Buy Back (OBB) rate dropped to 3.29 percent from 3.36 percent, while the Overnight (OVN) rate decreased to 3.93 percent from 4.07 percent.

“We expect rates to remain stable in the near term, as there are no significant outflows anticipated,” Cowry Asset said.

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan. Mr Olowookere can be reached via dipo.olowookere@businesspost.ng

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