According to a recent market report, Nigeria’s overnight lending rates fell on Friday below the 1 percent-mark as excess liquidity continues to be injected by the Central Bank of Nigeria (CBN) into the banking system.
The injection of liquidity by the CBN into the banking system rose on Friday as it opened at over N1 trillion credit, and this has driven the overnight lending rates below the 1 percent mark.
The current overnight lending rates stand at 0.5 percent on the interbank market, and has driven apathy amongst lenders who are unwilling to trade at low rates.
An analyst who spoke to Reuters said, “Markets will continue to be awash with liquidity (but) this is not long-term funds for lending until banks know what the central bank wants to do.”
