By Dipo Olowookere
There was an Open Market Operations (OMO) conducted by the Central Bank of Nigeria (CBN) on Thursday and it came 24 hours after the apex bank sold treasury bills to investors at the primary market.
The central bank offered the liquidity management tool to investors across three maturities during the session, with the stop rates remaining unchanged.
According to details of the exercise obtained by Business Post, the apex bank offered for sale N50.0 billion for a 96-day bill, another N50.0 billion for a 173-day bill and N230.0 billion for a 362-day bill and for the bids, investors showed a strong appetite for the long-dated maturity with N505.0 billion worth of subscriptions received.
However, the mid-term bill was slightly oversubscribed as bids valued at N54.1 billion were received, while the short-dated instrument was undersubscribed as only N45.5 billion was staked on it.
The CBN, thereafter, allotted the exact amount it auctioned for the respective bills, with N50.0 billion sold for the 96-day OMO bill, N50.0 billion for the 173-day OMO bill and N230.0 billion for the 362-day OMO bill.
Also, the central bank, as earlier stated, retained the stop rates for the respective maturity with the 3-month instrument clearing at 7.0 per cent, the 6-month instrument clearing at 8.5 per cent and the 12-month instrument clearing at 10.1 per cent.
Meanwhile, at the money market yesterday, Business Post observed that the average rates increased by 6.29 per cent on the back of the 6.10 per cent rise in the Open Buy Back (OBB) rate and 6.47 per cent jump in the Overnight (OVN) rate.
At the close of transactions, the OVN rate increased to 8.30 per cent, while the OBB rate rose to 7.60 per cent.
The rise in the rates was influenced by the debits from the recent sales of treasury bills by the central bank via the Nigerian Treasury Bills (NTB) and OMO bills, causing a squeeze in liquidity in the system.