Investors submitted bids totaling N1.5 trillion, which is more than the N312 .9 billion offered by the CBN
The Central Bank of Nigeria (CBN) has sold N1.3 trillion in Treasury Bills to attract foreign investors.
newsheadline247 understands that this move aims to increase forex inflow into Nigeria to strengthen the Naira.
Recall that, lately, the Naira has been under pressure due to a lack of forex available.
Treasury Bills, commonly known as T-Bills, are basically short-term debt securities issued by the government. They are a form of IOUs that the government uses to borrow money from the public.
They provide a secure opportunity for investors to earn a return on their investment.
By offering attractive interest rates, the Central Bank of Nigeria hopes to attract foreign investors to purchase these Treasury Bills.
This injects much-needed money into the economy, stabilizing and potentially lowering the exchange rate.
Pundits also agreed that the high demand for these T-Bills is a positive sign.
Investors submitted bids totaling N1.5 trillion, which is more than the N312 .9 billion offered by the CBN.
The Bank ultimately 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 should help bring the exchange rate down from its current high of around N1,500 to a dollar.
A stronger Naira has the benefit of making imports more affordable, which in turn can help to reduce inflation.
