How Buhari ‘Robbed’ Nigeria of Billions Within 3 Days – Report

8 Jul 2016

How Buhari ‘Robbed’ Nigeria of Billions Within 3 Days – Report


President Muhammadu Buhari’s declaration of Tuesday, Wednesday, and Thursday, as public holidays, has robbed Nigeria a whopping sum ‎of N138 billion, most especially at a time the nation is broke and needed to sure up its finances.

It could be recalled that the federal government had declared Tuesday and Wednesday as public holiday before adding Thursday, due to the late discovery of the moon.

According to Guardian, ‎Treasury bills auction estimated at N94 billion, as well as N44 billion treasury bills which was supposed to mature this week, could not because of the straight three-day holiday approved by President Buhari.

The monetary policy measures were expected to put liquidity into the system in the week, with the auction component helping to taper its effect on money market rates.

The treasury bills auctions and maturities are usually executed between Tuesdays and Thursdays, except for seeming special interventions on Fridays.

READ ALSO: Buhari, A Tribal And Religious Bigot Have Divided Nigeria On Ethnic Line As Never Seen Before

In the event that the monetary policy measures are implemented today (Friday), the effect in the market rates would be minimal and driven by sentiments, because the liquidity will not have trickled down to the market and volumes of interbank activities are usually moderate.‎

Last week, the treasury bills market saw renewed buying interest with the launch of the Naira-settled Over-the-Counter market, as the average rate declined on all the trading days of the week.

A decline in the rate of treasury bills shows confidence and an indication that traders are pricing the security with lesser risks attached, as well as the quantity of money in the market.

Average rate inched lower on Tuesday to 10.2 per cent as system liquidity improved owing to inflow of Federal Accounts Allocation Committee disbursement, from 10.7 per cent on Monday.

The sentiment continued till Friday, when average bills’ rate closed at 9.4 per cent, down 1.7 percent week-on-week on the back of N115 billion Open Market Operations maturity inflow into the system by Thursday.

READ ALSO: Tompolo seeks meeting with Buhari

Similarly, the interbank lending rate, particularly the Overnight, fell to five per cent on Friday, compared with 15 percent a week earlier, as cash from maturing treasury bills and payments by government to its contractors, boosted liquidity.

According to Reuters, the increased cash flow left the money market with a N267.10 billion surplus balance on Friday, reversing the N300 billion shortfall a week earlier and pushing down the cost of borrowing among commercial lenders.

Many banks had approached the central bank’s discount window to borrow short-term cash last week to enable them meet obligations and ease liquidity pressures, traders said.

Traders said the expected release of capital spending by the federal government to re-inflate the economy should inject more cash into the money market in the coming days, which should impact positively on the interbank rate.



News Source: Post-Nigeria, 9jaTales

  • 0Blogger Comment
  • Facebook Comment
  • Disqus Comment

Post a Comment

Be the first to comment among your friends

comments powered by Disqus