Nigeria sells treasuries to keep naira liquidity tight


Nigeria’s central bank sold N98 billion of treasury securities on Thursday to keep liquidity tight to support the currency, a day after it auctioned N133.25 billion of T-bills, traders said.

The local naira currency has been stable for more than two weeks, supported by central bank interventions, foreign inflows and tight liquidity on the money markets, traders say.

On Thursday, the bank sold the 91-day bill at a higher interest rate of 16 per cent plus a 196-day bill at 17.81 per cent.

At Wednesday’s auction, it sold N10.25 billion of a 91-day bill at an interest rate of 13.1 per cent, N11 billion of 182-day bills at 15.3 per cent and N112 billion of one-year paper at 15.59 per cent.

Total subscriptions were N194.6 billion.

The money market has been short of liquidity for more than a week due to central bank action to mop up naira following the recent maturity of some N86 billion of treasury securities, traders said.

The currency was quoted at 305.60 on the official market on Thursday, a level around which it has closed for more than three months. It traded at 360 per dollar for investors and at N363 on the parallel market.

© Reuters


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