The Central Bank of Nigeria has sold a record N1.3 trillion in Treasury Bills, specifically targeting overseas investors.
This is aimed at increase foreign exchange (forex) flowing into Nigeria and strengthening the Naira’s value.
The current Treasury Bills which is a secure way for investors to earn a return on their money, offers attractive interest rates. The CBN is hoping to entice foreign investors to buy these T-Bills.
This would inject the much-needed dollars into the economy, which would help stabilise and potentially lower the exchange rate.
The Nation reported that investors submitted bids totaling N1.5 trillion, exceeding the N312.9 billion offered by the CBN. The apex bank reportedly awarded N1.3 trillion in T-Bills at an interest rate of 21.49 percent.
These funds will be used by the CBN to intervene in the forex market, buying dollars and selling Naira.
This increased supply of dollars is expected to help bring the exchange rate down from its current high of around N1,600 to a dollar.
