The Central Bank of Nigeria, CBN on Friday, August 12, auctioned N206 billion in excess of its planned treasury debts of N50 billion at higher yields.
This move is expected to help mobilise the scarce foreign currency inflow. The apex bank also also plans to raise additional N110 billion in local currency-denominated bonds on Wednesday, August 17, even as they continue to seek advisers and book runners to manage a planned $1 billion Eurobond it intends to offer this year.
Specifically, the regulator raised raised N256 billion in six-month bill at the weekend, as N206 billion at a higher yield of 18 percent, which is also targeted at reducing the quantity of money in circulation.
Traders, who craved anonymity, said the whole move is aimed at driving the economy with bills and bonds, especially its sustenance at higher yields.
The apex bank at the last Monetary Policy Committee meeting in Abuja, had increased interest rate to 14 per cent from 12 per cent in an effort to reduce the negative rate of -4.5 per cent to -2.5, as inflation rose sharply to 16.5 per cent.
To this end, the sale of the treasury instrument mopped up the liquidity level, stoking high rates of lending among the Deposit Money Banks.
