Nigeria’s overnight funding market reached a historic milestone in June 2026, with total transaction volumes climbing to a record N97.45 trillion, the highest level recorded since the introduction of the Nigerian Overnight Financing Rate (NOFR). The latest data from the Central Bank of Nigeria (CBN) shows that trading activity remained robust throughout the period, reflecting growing confidence and deeper participation in the country’s short-term money market.
The market’s impressive growth began in May, when total traded volume surged by 42.58 percent to N96.36 trillion from N67.58 trillion recorded in April. Rather than slowing down, the momentum carried into June, with volumes increasing further by 1.13 percent to N97.45 trillion. Despite the sharp rise in trading activity, the benchmark NOFR remained remarkably stable, closing at exactly 22.00 percent on 59 of the 62 trading days reviewed between April and July.
Analysts say the stability of the overnight rate despite the surge in transactions points to healthy liquidity conditions within the banking system. Average daily market volume rose from N4.83 trillion in April to N5.35 trillion in May before easing slightly to N4.64 trillion in June. This trend suggests that banks and financial institutions were able to process larger volumes of overnight transactions without causing significant pressure on borrowing costs.
Some trading sessions stood out for their exceptional activity. May 6 recorded the highest daily turnover during the review period at N7.32 trillion, followed by May 19 with N6.77 trillion and May 5 with N6.67 trillion. While individual transaction rates occasionally fluctuated between 20 percent and as high as 32 percent, these isolated trades had little impact on the broader benchmark, which remained firmly anchored around 22 percent. Market observers view this as a sign of stability and efficiency within the interbank lending environment.
The NOFR, officially introduced by the CBN in collaboration with the Financial Markets Dealers Association (FMDA), is designed to serve as Nigeria’s benchmark for unsecured overnight borrowing. CBN Governor Olayemi Cardoso has described the rate as a major reform that will improve transparency, strengthen monetary policy transmission, and align Nigeria’s financial markets with global standards such as SOFR in the United States, SONIA in the United Kingdom, €STR in the Eurozone, and TONA in Japan. With trading volumes continuing to rise while borrowing costs remain stable, the latest figures highlight a maturing financial market and growing confidence in Nigeria’s evolving money market framework.
source: nairametrics
