Nigeria overnight rate nears 3-month low on excess liquidity

Nigeria’s overnight lending rates halved to 3 percent on Friday, down to near a three-month low after the central bank paid off treasury bills injecting liquidity into the banking system, traders said.

A total of 197 billion naira in matured Open Market bills (OMO) was retired on Friday while the central bank did not issue fresh bills to mop up funds in a bid to keep borrowing cost low, traders said.

Banking system credit opened at 189 billion naira on Friday before the inflow hit the system, lifting the sector’s total cash balance with the central bank to 386 billion naira, traders said.