The overnight money market rate (MMR) continues to rise since the entry into force of the decision taken by the Executive Board of the Central Bank of Tunisia (BCT) on December 30, 2022 to raise the key rate of the bank by 75 basis points to 8%.
To this end, the overnight MMR, on Wednesday January 11, 2023, crossed for the first time the threshold of 8% to 8.01%. In view of a possible liquidity crisis, the overnight MMR is likely to increase further in the coming weeks.
Moreover, the overall volume of refinancing of banks with the BCT has begun since December 2022 an accelerated upward trend to reach 14.2 billion dinars on Wednesday.
This development is due to the acceleration of the restrictive effects of the main autonomous factors of bank liquidity. Indeed, the acceleration of imports has accentuated the recourse of banks to the Central Bank for the purchase of foreign currency to cover the external commitments of economic players.
The overnight MMR corresponds to the rate at which banks borrow and lend money to each other within 24 hours. Following the increase in the key rate, the overnight deposit and marginal lending facilities have been raised to 7% and 9% respectively.