Nigerian interbank rates end 3-week slide on T-bill sales

Nigerian interbank lending rates rose marginally to an average of 10.75 percent on Friday, from 10.35 percent last week, ending a three week slide as treasury bill sales reduced naira supply.

Nigerian currency

   Lending rates among Nigerian banks have been on the decline in recent weeks as budgetary allocations to government agencies flooded the market with naira.
   The central bank sold about 364 billion naira ($2.29 billion) in open market operation (OMO) debt notes this week, in a bid to soak up excess money supply, traders said on Friday.
   However, about 295 billion naira in matured OMO debt notes this week provided some support to lending rates, they said.
   The market opened with a cash balance of about 535 billion naira on Friday, compared with 845 billion balance last week.
   The secured Open Buy Back rose marginally to 10.5 percent, from 10.25 percent last week, 1.5 percentage points below the central bank's benchmark interest rate of 12 percent.
   Overnight placement traded at 10.75 percent, up from 10.3 percent, while call money closed at 11 percent, 50 basis points higher than 10.5 percent last week.
Traders said the central bank may sell more OMO debt notes next week as part of its measures to curb speculative bids on the local currency in the foreign exchange markets.