The Central Bank of Nigeria (CBN) successfully raised over N1 trillion through an Open Market Operation (OMO) auction conducted on April 24, 2025, as part of its monetary policy strategy to manage liquidity in the financial system.

The auction, which attracted significant participation from commercial banks and other financial institutions, offered treasury bills with maturities ranging from 91 to 364 days. The CBN’s move aims to mop up excess liquidity, curb inflationary pressures, and stabilize the naira, which has faced volatility in recent months.

According to a statement from the C tos, the auction saw subscriptions totaling N1.2 trillion, with N1.03 trillion allotted across various tenors. The 364-day bills were the most sought-after, attracting N650 billion in subscriptions at a stop rate of 22.5%, reflecting strong investor confidence in longer-term instruments. The 182-day and 91-day bills recorded stop rates of 20.8% and 19.5%, respectively. The high demand underscores the attractiveness of CBN’s OMO bills, which offer competitive yields amid Nigeria’s high interest rate environment.

The CBN’s aggressive liquidity management comes as inflation reached 33.9% in March 2025, driven by rising food and energy costs. Analysts note that the OMO auction aligns with the CBN’s hawkish monetary policy stance, led by Governor Olayemi Cardoso, to anchor inflation expectations and support the naira, which traded at N1,602.63/$ in the parallel market in April 2025. The auction’s success is expected to reduce money supply growth, which stood at N5 trillion in circulation in early 2025, according to CBN data. However, some economists warn that sustained high interest rates could dampen credit growth and economic activity, posing challenges for businesses and consumers.