Data from the apex bank show that OMO maturities of ₦459.60 billion are due today, while Nigerian Treasury Bill (NTB) maturities of ₦324.41 billion will enter the market on Thursday. System liquidity opened at ₦275.9 billion on September 1, 2025—up 10.4 percent from ₦249.8 billion recorded a week earlier.
OMO, a key monetary policy tool, allows the CBN to regulate money supply by issuing short-term securities to banks and investors, thereby withdrawing cash from circulation. This helps reduce inflationary pressures while stabilising the naira.
According to Coronation Merchant Bank, the planned ₦480 billion NTB auction on Wednesday will further complement liquidity absorption efforts. In the bond market, yields are expected to ease amid strong demand for newly issued Federal Government securities.
Last week, liquidity in the system rebounded to ₦1.40 trillion from a deficit of ₦609.43 billion the previous week. The turnaround was supported by FAAC disbursements and ₦758 billion in OMO maturities, which offset the CBN’s liquidity absorption of ₦1.19 trillion. As a result, interbank rates declined, with the Open Repo Rate (OPR) and Overnight Rate (OVN) falling to 26.50 percent and 26.95 percent, respectively.
In the T-bills secondary market, trading was mixed as average yields rose 23 basis points week-on-week to 22.18 percent. NTB yields climbed 50bps to 18.88 percent, while OMO yields eased slightly by 3bps to 25.49 percent.
Aggressive Liquidity Tightening
CBN data show that liquidity mop-ups through OMO sales surged by 79 percent year-on-year. Between January and August 2025, the bank withdrew ₦13.35 trillion from the system, compared to ₦7.45 trillion in the same period of 2024. Under Governor Olayemi Cardoso, the CBN has pursued one of its most aggressive tightening drives in years.
By comparison, OMO sales stood at just ₦710 billion in the first eight months of 2022, before Cardoso’s appointment. The scale-up has also been deployed to attract foreign portfolio inflows and shore up FX liquidity. Elevated OMO yields, which peaked at 24.4 percent in September 2024, provided favorable conditions for carry trades, boosting naira stability.
Expert Reactions
Ayodele Akinwunmi, chief economist at United Capital Plc, said OMO has been central to the CBN’s liquidity management strategy. “The tool has helped stabilise prices, attract foreign investors, and build confidence in the Nigerian market,” he noted.
FBNQuest, in its recent outlook, highlighted that OMO sales jumped to ₦13.5 trillion in 2024, up from ₦723 billion in 2023. Notably, the apex bank sold ₦1.4 trillion in 365-day bills during a single auction in November 2024—almost double the total issuance for the previous year.
Nigeria’s inflation rate has responded modestly, easing for four consecutive months from 22.22 percent in June to 21.88 percent in July 2025. Analysts say the steady disinflation underscores the effectiveness of the CBN’s tightening stance.
