Money Market Rates Steady Amidst Heavy Liquidity

Money Market Rates Steady Amidst Heavy Liquidity

Money market rates were steady amid heavy liquidity in the financial system, reflecting the absence of significant funding pressure.

The financial system was debited for the Nigerian Treasury bills auction conducted on Wednesday, and the Central Bank practically ignored the excess funding level, with no open market operations.

Market analysts said funding costs remained stable, with both the Overnight rate and the Open Repo rate holding firm at 22.31% and 22.00% respectively. 

According to AIICO Capital Limited, liquidity in the banking system opened Thursday on a surplus note of ₦6.62 trillion, but ₦472.25 billion shy of its opening balance from the prior session.

Investment analysts said the decline was mainly driven by a ₦731.38 billion outflow settled at the auction held on Wednesday, despite an offset from a ₦351.89 billion inflow from 09-APR-2026 NTB maturities.

DMB placements at the CBN’s Standing Deposit Facility (SLF) window remain elevated at ₦6.86 trillion. However, improved system liquidity had little effect, as the average funding cost remained flat at 22.16%.

The Open Repo Rate (OPR) remained steady at 22.00%, while the Overnight Rate (OVN) remained unchanged at 22.31%. Given current liquidity levels, CBN mop-up activities are expected. Barring any such activities, we expect funding rates to hold steady at current levels, AIICO Capital said.

The average yield on Nigerian Treasury bills eased 14bps to close at 17.43%, pointing to a modest improvement in investor demand even as caution continued to linger across the fixed-income space.

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