MONDAY, 28 JUNE 2010 01:15        

 

Inter-bank rates eased to 1.1 percent on average last week from 1.28 percent penultimate week after the inflow of over N300 billion in monthly budgetary allocations to government agencies boosted liquidity in the system, traders said weekend.They said the outflow of N158 billion in forex and bonds purchases did not have a serious impact, adding that the market was expected to remain liquid for next two weeks if there are no major withdrawals, until another tranche of budget funds was disbursed.

 

The secured Open Buy Back (OBB) dropped to 1.05 percent from 1.20 percent, 0.05 percent above the Standing Deposit Facility (SDF) rate and 4.95 percent below the 6.0 percent central bank benchmark rate. Overnight placement eased to 1.10 percent from 1.30 percent, while call money fell to 1.15 percent from 1.35 percent.“The system remained very liquid with the opening balance of about N449.50 billion ($3.02 billion) on Friday,” one dealer said.

 

The Central Bank of Nigeria (CBN) sold about $522 million at its forex auction last week, while Debt Management Office (DMO) sold N80 billion in 20-, 5- and 3-year bonds at a debt auction. “We expect rates would remain low in the next two weeks unless there is a major cash outflow which could lead to a slight increase,” another dealer said.

 

Meanwhile, banks dragged Nigeria’s all-share index lower for the sixth straight day (Friday), bringing losses last week to 2.44 percent as investors continue to worry about the speed with which lenders are returning to profit after last year’s bailout.The index closes at 25,154.26 points but dipped to a three-month low earlier in the trading session.

 

(Source:BusinessDay)