naira slides N1.39k/$
Overnight rate, which is the interest rate that deposit money banks use in borrowing and lending available funds to each other, on Tuesday, rose by 84.29 percent to 91 percent as banks remit funds in compliance with the Treasury Single Account (TSA) deadline that ended Tuesday.
Consequently, the Nigeria Inter-Bank Offered Rates for 1Month, 3Months and 6Months tenor rates increased by, 1.07 percent, 0.63 percent and 0.36 percent, respectively, to 16.28, 16.79 and 17.88 percent, respectively. Also, OBB and OVN rates increased by 42.84 percent and 44 percent, respectively, at the close of yesterday’s trading.
According to analysts at Meristem Securities Limited, sell sentiments reigned supreme in the Treasury bills market, with yields increasing across all instruments by an average of 1.14 percent to peg at 15.61 percent. The 3Months, 6Months and 9Months witnessed the most sell pressure of 1.58 percent, 1.66 percent and 1.91 percent in that order.
Correspondingly, offer yields advanced across most bond instruments due to massive sell pressure beheld in the market during the day.
However, the 14-MAR-2024, 27-JUL-2017, 31-AUG-2017 and 30-MAY-2018 instruments declined marginally by an average offer yield of 0.04 percent.
The domestic currency pared against the greenback by 0.70 percent to peg at a mid-price of N199/share, consequently, year-to-date return closed the day at -7.26 percent.
“We opine that the broad bearish mood witnessed in the market today, is not unrelated to the TSA implementation which became fully effective today, thus eliminating some of the funds previously available to Banks,” the analysts said.
Naira on Tuesday weakened against the dollar by N1.39k or 0.70 percent at the interbank foreign exchange market.
After trading on Tuesday, the local currency closed at N199.05k/$ as against N197.66k/$ traded the previous day, data from FMDQ revealed.
At the Bureau de Change (BDC) naira gained N1.00k/$ or 0.45 percent as it closed at N222/$ compared with N223/$ the previous day. It also gained slightly against the dollar at the parallel market by N.50k/$ or 0.22 percent, closing at N224/$ from N224.50k/$ on Monday.
Source : BusinessDay