The Central Bank of Nigeria on in a bid to check the a level of 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 night.
The statement said the amount would be mopped up through a special Open Market Operations at the rate of 16 per cent per annum.
Open market 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 facilitated by the CBN.
Okorafor said the decision was reached at the end of a meeting of the Bankers’ Committee in Lagos on Thursday, June 15, 2017.
The apex bank in the statement said its decision to mop up liquidity was in reaction to the maturity of N206bn on Thursday.
The statement reads 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, June 15, 2017, the CBN said its decision to mop up liquidity was in reaction to the maturity of N206 billion on Thursday, June 15, 2017.”
Okorafor, further 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 will continue to fall.
The apex bank had on Monday released its Treasury Bills Issue Programme for the third quarter of 2017 in which it disclosed that the maturity dates for the various tenors will be June 15, June 22, July 6, July 20, August 3, August 17 and August 31, 2017, respectively.
