The Central Bank of Nigeria has said it plans to issue N142.97bn ($903.73m) in treasury bills ranging from three-month to one-year maturities at its regular twice-monthly auction on September 6.
The bank in a public notice on Wednesday said it would raise N32.97bn in 91-day notes, N50bn in 182-day bills and N60bn in the 264-day paper.
CBN issues treasury bills regularly to reduce money supply, curb inflation and help banks manage their liquidity.
Meanwhile, the naira firmed against the United States dollar on the inter-bank market on Wednesday, supported by dollar sales by an oil company and some banks towards the close of trading.
The naira closed at N158.25 to the dollar on the inter-bank, stronger than the 158.15 it closed at the previous day.
Traders said a local unit of US oil giant Chevron sold about $12m to some lenders, while some units of foreign banks sold additional dollars in the market to enable them to stay within the stipulated one per cent open position limit.
Reuters quoted a dealer as saying, “The naira actually trended down intraday because of strong dollar buying but strengthened toward the close of trading because some foreign banks sold additional dollars in the market, which provided support for the naira.
The CBN in July raised the cash reserve requirement for banks to 12 per cent from eight per cent, and reduced net open foreign exchange positions to one per cent from three per cent, to restrict the money supply and support the local currency.
The naira has been pressured by global risk aversion but has gained more than 1.25 per cent year-to-date on the CBN’s measures and a resurgence of offshore investors buying local debt, boosting dollar liquidity in the market.
Traders said the naira would continue to hover around the present level for the rest of the week as trickles of dollars from oil companies should subdue any buying pressure from importers.
At its twice weekly foreign exchange auction, the CBN sold $180m at N155.80 to the dollar, compared with the $250m sold at the same rate on Monday.
Source: Punch
