The Central Bank of Nigeria, in a bid to check inflation in the country, has unveiled plans to mop up a total of N200.32bn from the banking sector.
The Acting Director, Corporate Communications Department, CBN, Isaac Okorafor, confirmed this in a statement issued on Thursday.
The statement said the amount would be mopped up through a special Open Market Operation at the rate of 16 per cent per annum.
Open market operation refers to the buying and selling of government securities in the open market in order to expand or contract that amount of money in the banking system and is facilitated by the CBN.
Okorafor said the decision was reached at the end of a meeting of the Bankers’ Committee in Lagos on Thursday.
The apex bank said its decision to mop up liquidity was in reaction to the maturity of N206bn on Thursday.
The statement read in part, “In a move to further rein in inflation, the Central Bank of Nigeria has unveiled plans to mop up a total of N200.32bn from the Nigerian banking system through a special Open Market Operation at the rate of 16 per cent per annum.
“Rising from a meeting of the Bankers’ Committee in Lagos on Thursday, the CBN said its decision to mop up liquidity was in reaction to the maturity of N206bn on Thursday, June 15, 2017.”
Okorafor explained that the apex bank decided on the rate of 16 per cent per annum due to the falling rate of inflation, which he noted would continue to decline.
The CBN had on Monday released its Treasury Bills Issue Programme for the third quarter of the year in which it disclosed that the maturity dates for the various tenors would be June 15, June 22, July 6, July 20, August 3, August 17 and August 31, 2017, respectively.
