Nigeria's interbank lending rates eased to an average of 10.37 percent this week, compared with 10.62 percent a week earlier, with markets expecting a liquidity boost from monthly government budgetary disbursement.
Traders said though market liquidity was hit by large cash outflows to bond auction and open market operation (OMO), resulting in an outflow of about 220 billion naira ($1.35 billion), the market closed with a surplus of about 200 billion in cash on Friday.
Nigeria sold 100 billion naira in 3-year, 10-year and 20-year bonds on Wednesday, while the central bank issued about 117 billion in new OMO treasury bills.
"We are expecting a further boost in liquidity level by the close of business today (Friday) from budget allocations to government agencies and this has helped to keep the market in check," one dealer said.
The cash balance that lenders hold at the central bank was 400 billion naira at the open of trading on Friday, compared with 204.37 billion naira last Friday.
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