By BizWatch Nigeria, Markets Desk | April 16, 2026
Key Points
- System liquidity rises 18.90% to ₦5.91 trillion after ₦1.34 trillion OMO inflow
- Central Bank of Nigeria conducts ₦600 billion OMO auction amid excess liquidity
- Overnight rate increases to 22.29% despite improved market liquidity
Main Story
Nigeria’s financial system liquidity surged by 18.90% to ₦5.91 trillion on Tuesday, driven primarily by a ₦1.34 trillion Open Market Operations (OMO) bill repayment, according to market data from Meristem Securities.
The inflow significantly boosted banks’ opening balances, which rose by 18.98%, although this was partly offset by an 8.06% decline in deposits at the Central Bank’s Standing Deposit Facility (SDF).
Despite the liquidity expansion, short-term funding costs edged higher. The overnight lending rate rose by 10 basis points to 22.29%, while the overnight repo rate held steady at 22.00%, reflecting cautious interbank positioning.
In response to the liquidity spike, the Central Bank of Nigeria conducted an OMO auction, offering ₦600 billion across three maturities. However, demand significantly outpaced supply, with total subscriptions leading to a ₦2.2 trillion allotment to foreign portfolio investors and deposit money banks.
The strong demand underscores sustained investor appetite for high-yield government securities amid tight monetary conditions and elevated benchmark rates.
What’s Being Said
“The liquidity injection from maturing OMO bills has temporarily eased funding pressures, but elevated rates indicate that liquidity distribution remains uneven,” said a fixed income analyst at Meristem Securities.
“The strong subscription at the OMO auction reflects continued investor confidence in Nigeria’s fixed income market, particularly from offshore participants,” a Lagos-based portfolio manager noted.
What’s Next
- Further OMO auctions are expected as the CBN continues liquidity sterilisation
- Interbank rates likely to remain elevated amid tight monetary stance
- Next Monetary Policy Committee (MPC) meeting will guide rate direction
