The Central Bank of Nigeria (CBN) raised a total of N1.008 trillion at its Open Market Operations (OMO) auction held on Friday.
This outcome followed overwhelming investor demand that created a 102% oversubscription, confirming CBN’s aggressive monetary tightening approach aimed at reducing excess liquidity and controlling persistent inflationary pressures despite high interest rates and a record-high cash reserve ratio.
Initially offering N500 billion across two maturities, the auction attracted nearly N1.4 trillion in total bids, as investors sought to benefit from high-yield government instruments amid rising inflation and expanding money supply.
The 319-day OMO bill, maturing on March 10, 2026, proved most popular at the auction. It attracted N1.062 trillion in subscriptions, more than four times the CBN’s N250 billion offer. The central bank ultimately allocated N688.30 billion at a stop rate of 22.73%, with bid rates ranging from 20.39% to 23.75%.
This surge in demand reflects investor expectations that high interest rates will continue, encouraging them to secure attractive yields for longer terms.
The 298-day bill, maturing on February 17, 2026, also performed well. It received N329.54 billion in bids against the same N250 billion offer. The CBN allocated N319.54 billion at a stop rate of 22.37%, with bid rates between 20.45% and 23.75%.
In total, the CBN raised N1.008 trillion, doubling its initial offer and demonstrating that significant liquidity remains available in the financial system despite policy tightening measures.
This OMO auction is happening while Nigeria’s broad money supply (M3) rises sharply, undermining CBN’s efforts to reduce liquidity through tools like the 50% cash reserve ratio (CRR)—currently the highest worldwide.
CBN data shows M3 grew to N114.22 trillion in March 2025, representing a 24% year-on-year increase from N92.19 trillion in March 2024.
Month-on-month, money supply increased by 3.2%, up from N110.71 trillion in February. This growth largely came from a 38.9% increase in net foreign assets (NFA), which reached N45.17 trillion, indicating stronger capital inflows and external liquidity.
