This week, the Interbank money market will receive a major facelift of N367 billion inflow from matured treasury bills. This will assist to control the cost of funds. Last week, the cost of funds closed way lower when compared to the previous week. This is surprising as there was a sharp decline in the volume of excess cash in the market. Reports revealed that market cash availability fell to N139.2 billion, a whopping 64%. Among other factors, the decline was caused by an outflow of N60 billion due to auction of the secondary market (Open Market Operations, OMO) Treasury Bills (TBs).
The N367 billion inflow is a direct result of the maturing N352.8 billion from the OMO bills and N14.6 billion from maturing primary TBs.
Market analysts and observers are of the opinion that the said maturities of OMO and TBs instruments worth N352.8 billion and N90.9 million respectively will keep money market rates low in the coming week.”
This will also mean a further decline in the marginal (stop) rates.
More information to follow soon…