The Central Bank of Nigeria (CBN) has explained the reason its Open Market Operation (OMO) was oversubscribed by investors across the globe.
The CBN governor, Olayemi Cardoso, said the success of the sale of government securities, issuing N1.053 Trillion (US$680 million) in short-term instruments as part of its liquidity management exercise was driven based on the commitment of the apex bank to ensure stability.
Cardoso explained that the CBN is committed to supporting price stability by taking the necessary measures to increase liquidity in the foreign exchange markets sustainably.
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.
The auction which was the first since the CBN’s Monetary Policy Committee meeting, 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 highlighted further that 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 apex bank.
According to him, the focus of the apex bank is on building a fully functioning market that allows smooth entry and exit for investors.
The Acting Director, Corporate Communications Department, Mrs Hakama Sidi Ali told newsmen in Abuja that the development underscored the level of confidence that the Bank now enjoyed from investors.
Mrs Siri-Ali added that the Management of the central bank was optimistic its monetary policy measures were beginning to yield positive results.
