Nigerian overnight lending rate was quoted as high as 100 percent on Tuesday from 40 percent previous day on cash shortages, sending bond yields higher as commercial banks sold bonds to meet naira obligations, traders said.
Traders were quoting for rates at between 70 to 100 percent as the overnight money market was experiencing low liquidity after Nigeria’s president directed all state agencies to maintain one treasury account, sucking up cheap government cash from the banking system.
Yields on the benchmark 2024 bond, which is also listed on the JP Morgan government bond index, opened at 15.87 percent on Tuesday, a level it closed at on Monday, up from 15.45 percent on Friday.
