How Nigeria’s New Overnight Rate Could Redraw Rules Of Financial Pricing

MARK ITSIBOR writes on the recently launched Overnight Financing Rate and concluded that the authorities and players must uphold integrity for the market to thrive on trust
Money has a price. Yet determining that price accurately remains one of the hardest tasks in finance.
In every economy, banks lend to one another. Investors buy securities. Companies borrow funds. Governments issue debt. Behind those transactions lies a simple question: what is the true cost of money today?
 
The Answer Matters.
When markets cannot answer that question clearly, pricing becomes uncertain. Investors demand higher returns. Borrowing costs rise. Financial decisions become less efficient.
For y...