In a development which indicates renewed confidence in the policies of the Central Bank of Nigeria and the economy in general, the Central Bank of Nigeria (CBN), on Friday, March 1, 2024, successfully concluded a sale of government securities, issuing N1.053 Trillion (US$680 million) in short-term instruments as part of its liquidity management exercise.
The sale was not only oversubscribed but attracted a huge proportion of foreign bids.
The CBN offered N500 Billion at the Open Market Operations (OMO) auction and oversubscribed, selling N1.053 Trillion, with 79% of the total bids, or the equivalent of US$530 million, coming from foreign investors.
Friday’s auction was the first since the CBN’s Monetary Policy Committee meeting, which was followed by a virtual meeting with foreign portfolio investors.
The CBN Governor, Mr. Olayemi Cardoso, used both meetings to set a detailed strategy to curb inflation, stabilise the exchange rate, and spur confidence in the banking system and economy. Mr. Cardoso further highlighted in the meeting with investors an outlook for sustained increases in the CBN’s foreign currency reserves, improved liquidity in the foreign exchange market, and imminent settlement of the remaining backlog of genuine Foreign Exchange transactions by the Central Bank of Nigeria.
According to him, “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.
Speaking with journalists in Abuja at the weekend, the Bank’s Acting Director, Corporate Communications Department, Mrs. Hakama Sidi Ali said the development underscored the level of confidence that the Bank now enjoyed from investors.
She also said the Management of the CBN was optimistic that its monetary policy measures were beginning to yield positive results.