Dipo Olowookere
By Dipo Olowookere
Yields on the four benchmark treasury bills monitored by Business Post at the secondary market on Tuesday moved in different directions at the close of business.
This occurred in the absence of an Open Market Operations (OMO) by the Central Bank of Nigeria (CBN) yesterday to mop up excess liquidity in the financial system. However, there are strong expectations of an OMO auction on Thursday.
At the close of transactions on Tuesday, the average yields of treasury bills increased by 0.06 percent to settle at 12.75 percent. It was observed that yields of two of the instruments rose, while the two others declined.
An analysis showed that yield on the one-month maturity depreciated by 0.10 percent to 11.70 percent from 11.80 percent, while yield on the one-year tenor fell by 0.08 percent to 14.85 percent from 14.94 percent.
On the other hand, yield on the three-month bill increased by 0.25 percent to 12.04 percent from 11.79 percent, while yield on the six-month maturity rose by 0.15 percent to 12.40 percent from 12.26 percent.
As put by analysts at Zedcrest Research, “We expect demand for T-bills to be sustained especially at the long end of the curve as we near another OMO maturity.”
Meanwhile, at the money market, the average rates increased by 0.36 percent on the back of the 0.43 percent rise in the Open Buy Back (OBB) rate and 0.29 percent increase in the Overnight (OVN) rate.
Consequently, the OBB rate moved to 3.57 percent 3.14 percent, while the OVN rate moved to 4.14 percent from 3.86 percent.
“We expect rates to remain at these low levels tomorrow, as there is no significant funding expected to negatively impact liquidity,” Zedcrest Research further said.
