- As T-Bills Yields Continue Uptrend
Nigeria’s system liquidity remained firmly in surplus throughout the past week despite the Central Bank of Nigeria’s (CBN) aggressive liquidity sterilization efforts.
The market opened with a robust net liquidity surplus of N4.40 trillion, supported by previous OMO bill maturities.
Although the CBN conducted an Open Market Operation (OMO) auction, successfully mopping up N2.10 trillion, and the N1.20 trillion settlement for the Federal Government bond auction further debited the banking system, these outflows were largely offset by N600 billion in maturing OMO bills that flowed back into the system.
Consequently, system liquidity remained comfortably positive, closing the week at N4.10 trillion, compared with N3.98 trillion recorded in the previous week.
The ample liquidity environment moderated funding pressures in the interbank market, although rates edged marginally higher.
The Overnight Policy Rate (OPR) remained unchanged at 22.00%, while the Overnight (O/N) rate inched up by 3 basis points to 22.23% from 22.20% in the preceding week.
Similarly, the Nigerian Interbank Offered Rate (NIBOR) advanced across all maturities, reflecting cautious liquidity management by banks amid sustained CBN sterilization activities.
Overnight NIBOR rose by 6 basis points to 22.28%, while the 1-month, 3-month, and 6-month tenors increased by 27bps, 38bps, and 70bps to settle at 22.74%, 23.19%, and 23.69%, respectively.
The Nigerian Treasury Bill True Yield (NITTY) curve also shifted upward across the benchmark tenors.
The 1-month and 3-month yields increased modestly by 7bps and 8bps, respectively, while the 6-month and 12-month tenors recorded sharper increases of 47bps and 59bps to close at 18.40% and 20.84%, indicating investors’ demand for higher yields amid persistent primary market supply
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