By Dipo Olowookere
The treasury bills market was bullish on Monday ahead of the primary market auction to be conducted by the Central Bank of Nigeria (CBN) on Wednesday (today).
Business Post reports that the average T-bills yields depreciated at the close of the day’s trades by 1.75 percent to settle at 12.35 percent as inflows from FAAC payments significantly strengthened system liquidity.
It was observed that during trading yesterday, there were huge interests on the Jan – March maturities.
As a result, the 1-month, 3-month, 6-month and 9-month notes recorded yield declines of 0.56 percent, 7.91 percent, 0.13 percent and 0.36 percent respectively, with the yield on the 12-month paper appreciating by 0.20 percent at the close of transactions on Tuesday.
However, the market is expected to trade on a relatively calmer note in today’s session as market players position for the NTB auction, where the CBN intends to rollover a total of N145 billion in NTB maturities.
“Rates are expected to clear considerably higher, especially on the 364-day due to the double hike in OMO stop rates from the last NTB auction,” analysts at Zedcrest Research said.
Meanwhile, in line with expectations, the average money market rate declined yesterday to 9.92 percent.
This was as the Open Buy Back (OBB) and Overnight (OVN) rates decreased by 5.33 percent and 5.17 percent respectively to finish at 9.50 percent and 10.33 percent accordingly.
This came on the back of inflows from FAAC payments of about N382 billion, which was estimated to have bolstered system liquidity to N490 billion from N110 billion opening on Tuesday.
The rates are anticipated to remain relatively stable today as there are no significant outflows expected.
Adedapo Adesanya