The Central Bank of Nigeria (CBN) has announced the completion of a sale of government securities, with N1.053 Trillion (US$680 million) in short-term instruments issued as part of its liquidity management strategy.
In a statement released on Monday, the apex bank announced that investors showed significant interest in the exercise, which concluded on March 1, 2024.
The Central Bank of Nigeria (CBN) initially offered N500 Billion at the Open Market Operations (OMO) auction, but it was oversubscribed, resulting in the sale of N1.053 Trillion. Notably, 79% of the total bids, amounting to approximately US$530 million, came from foreign investors.
This auction, held on Friday, marked the first since the CBN’s Monetary Policy Committee meeting, which was followed by a virtual engagement with foreign portfolio investors. During these interactions, CBN Governor Mr. Olayemi Cardoso outlined a comprehensive strategy aimed at combating inflation, stabilizing the exchange rate, and fostering confidence in both the banking system and the broader economy.
In discussions with investors, Governor Cardoso emphasized the expected sustained growth in the CBN’s foreign currency reserves, improved liquidity in the foreign exchange market, and the forthcoming resolution of the remaining genuine Foreign Exchange transactions backlog by the Central Bank of Nigeria.
Cardoso said, “The CBN is committed to supporting price stability by taking the necessary measures to increase liquidity in the foreign exchange markets sustainably.
“Our focus is on building a fully functioning market that allows smooth entry and exit for investors,” he added.
The bank’s spokesperson, Hakama Sidi Ali, highlighted that this development underscores the significant level of confidence investors now have in the Bank.
Additionally, she expressed the Management’s optimism that the monetary policy measures implemented by the CBN are starting to yield positive results.