Interbank rates dropped as liquidity pressures in the financial system eased on Monday. Short term benchmark interest rates headed south in the absence of significant pressures on liquidity balance in the financial system.

Nigerian interbank offered rate (NIBOR) declined across most maturities, signaling improved liquidity conditions in the money market at the beginning. Inflows from various saturated the market, and reduced pressure on funding profile.

The opening system liquidity remained buoyant to end the month analysts at Futureview Financial Limited reported that liquidity increased to N253.59 billion from negative position on Friday.

Hence, the Open Repo Rate (OPR) and the Overnight Rate (O/N) declined by 140 bps and 130 bps to 28.03% and 28.72%, respectively, data from the FMDQ confirmed.

Also, the treasury bills market was quiet but showed a bullish tone. There was little buying interest in the 25-Sep-2025 paper, although sellers offered the 27-Mar-2025 bill. Overall, the average interest rate for the benchmark NTB decreased by 5 bps to 20.42%

The buoyant system liquidity – NGN40.38 bills as of September 24, 2024), combined with coupon payments and FAAC inflows of N1.20 trillion, had dragged money market rates to a 20% range last week.

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