By Boluwatife Oshadiya | April 16, 2026
Key Points
- System liquidity rises 18.90% to ₦5.91 trillion
- ₦1.34 trillion OMO bill repayment drives cash inflow
- CBN conducts ₦600 billion OMO auction amid rising rates
Main Story
Nigeria’s financial system liquidity expanded sharply by 18.90% to ₦5.91 trillion following a major Open Market Operations (OMO) bill repayment valued at ₦1.34 trillion, according to market data from Meristem Securities.
The liquidity surge was further supported by an 18.98% increase in the system’s opening balance, offsetting an 8.06% decline in deposits held by banks at the Central Bank of Nigeria’s Standing Deposit Facility (SDF).
Despite improved liquidity conditions, short-term interest rates showed mixed movements. The overnight lending rate edged up by 10 basis points to 22.29%, indicating persistent funding pressures, while the overnight repo rate remained unchanged at 22.00%.
In response to evolving liquidity dynamics, the Central Bank conducted an OMO auction offering ₦600 billion across three maturities. Demand significantly exceeded supply, with total allotments reaching ₦2.2 trillion, largely taken up by foreign portfolio investors and deposit money banks.
The OMO market remains a critical tool for the apex bank in managing excess liquidity and stabilising the naira amid volatile capital flows.
What’s Being Said
“The spike in liquidity reflects the maturity profile of previous OMO issuances, but the strong auction demand suggests sustained investor appetite for high-yield instruments,” said analysts at Meristem Securities.
“However, elevated short-term rates indicate that liquidity is not evenly distributed across the banking system,” the firm noted.
What’s Next
- Further OMO auctions are expected as the CBN continues liquidity sterilisation efforts
- Money market rates will be closely watched for signs of easing or tightening
- Foreign portfolio participation may remain elevated amid attractive yields
The Bottom Line: The liquidity surge provides short-term relief to the financial system, but persistently high interest rates signal underlying structural tightness. The CBN’s balancing act between liquidity management and inflation control remains firmly in focus.
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