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LequteMan
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Nigeria's overnight lending rate on Wednesday fell to record low of 2 percent as the central bank refunded excess withdrawals from lenders before it loosened monetary policy last month to spur credit growth, traders said.
CBN has been injecting cash into the banking system in a bid to ease liquidity and stave off recession in Africa's biggest economy, which has suffered as oil prices fell.
The apex bank had cut cash reserve requirements for lenders to 25 percent from 31 percent two weeks ago and left interest rates on hold at 13 percent.
Liquidity had dried up as authorities ordered banks to move government deposits into a single account at the central bank, part of an anti-graft drive.
"We expect rates to remain low until central bank issues new bills," one dealer said.
The overnight lending rate has hovered around a three-month low of 3 percent since last week after the central bank repaid matured open market bills and did not issue fresh ones to mop up funds, in a bid to keep borrowing costs low.
Reuters
CBN has been injecting cash into the banking system in a bid to ease liquidity and stave off recession in Africa's biggest economy, which has suffered as oil prices fell.
The apex bank had cut cash reserve requirements for lenders to 25 percent from 31 percent two weeks ago and left interest rates on hold at 13 percent.
Liquidity had dried up as authorities ordered banks to move government deposits into a single account at the central bank, part of an anti-graft drive.
"We expect rates to remain low until central bank issues new bills," one dealer said.
The overnight lending rate has hovered around a three-month low of 3 percent since last week after the central bank repaid matured open market bills and did not issue fresh ones to mop up funds, in a bid to keep borrowing costs low.
Reuters
