The Central Bank of Nigeria, CBN, has sold N676.65 billion through the Open Market Operation, OMO.
It was sold at a 21 per cent interest rate to manage the banking system’s liquidity to prevent an oversupply of naira, which could trigger inflationary pressures.
A data from the apex bank’s first April Auction schedule on Thursday, indicates that the sales also aims to provide an avenue for the CBN to stabilise the financial markets by offering competitive returns to investors.
Accordingly, the apex bank leveraged higher interest rates to attract a strong turnout from investors, utilising OMO bills to absorb excess liquidity from the financial system.
Further analysis showed that with an offering of N75 billion, the 97-day bills attracted a subscription of N17 billion, with the total sale mirroring the subscription figure.
The medium-term offering, consisting of the 188-day bills with the same N75 billion on the block, saw an elevated subscription at N20.25 billion.
The clearing stop rate of 19.50 per cent resulted in sales worth N7.25 billion, which is significantly below the amount offered.
