The Open Market Operation (OMO) market recorded no sales to the N70 billion bill offered to investors by the Central Bank of Nigeria (CBN) on Thursday due to demand for higher rates.
The short, medium and long-term instruments were oversubscribed by investors but the CBN could not meet their demand, leading to no sales.
A breakdown of the OMO auction shows that the CBN offered N50 billion for the longer-term bill which was oversubscribed to the tune of N306.67 billion at a bid range of between 12.34 percent and 12.60 percent.
The 89-day and 194-day tenors were allocated N10 billion each. While the shorter instrument (89-day) was oversubscribed to the tune of N20.50 billion, the medium-term bill (194-day) was oversubscribed by N17.00 billion. Investors demanded a stop rate of between 11.23 percent and 11.49 percent.
The average OMO yield across the curve declined by 46 bps to 8.45 percent on Friday. NT-bills market closed on a positive note on Friday, with average yield across the curve declining by 1 basis point to close at 2.28 percent, a report by FSDH Research stated.
The overnight rate declined by 0.98 percent to close at 3.42 percent on Friday. The Open Buy Back (OBB) rate also declined by 0.85 percent to close at 2.75 percent.
