CBN to Launch Fresh OMO Sales to Absorb N784bn Liquidity Inflows
Story: written by Uzuh Rita September 2,2025
The Central Bank of Nigeria (CBN) will issue fresh Open Market Operations (OMO) this week to mop up excess liquidity as N784 billion inflows hit the banking system.
According to CBN data, OMO maturities of N459.60 billion are due today, while Nigerian Treasury Bill (NTB) maturities worth N324.41 billion will follow on Thursday. Banking system liquidity opened at N275.9 billion on September 1, 2025, up 10.4% from N249.8 billion on August 25.
OMO remains one of the CBN’s key monetary policy tools, helping regulate money supply by selling short-term securities to banks and investors. This reduces excess cash in circulation, curbs inflation, and supports naira stability.
Liquidity Outlook and Market Reactions
Coronation Merchant Bank noted that the scheduled N480 billion NTB auction on Wednesday will further strengthen liquidity mop-up. In the FGN bond market, strong demand for new issuances is expected to keep yields moderate.
Last week, system liquidity rebounded to N1.40 trillion, reversing from a N609.43 billion deficit the previous week. The turnaround was fueled by FAAC disbursements and OMO maturities of N758 billion, which outweighed the CBN’s liquidity absorption of N1.19 trillion through OMO sales.
As a result, interbank rates eased, with the Open Repo Rate (OPR) falling to 26.50% and the Overnight (OVN) rate to 26.95%.
Inflation Control and Investor Confidence
The CBN’s aggressive OMO program has significantly expanded under Governor Olayemi Cardoso. Between January and August 2025, the apex bank withdrew N13.35 trillion from the financial system through OMO sales, compared with N7.45 trillion in the same period of 2024.
Analysts highlight that elevated OMO yields have also attracted foreign portfolio investors (FPIs), strengthening FX liquidity and enhancing naira stability. Nigeria’s headline inflation eased to 21.88% in July 2025, marking the fourth consecutive monthly decline.
Ayodele Akinwunmi, Chief Economist at United Capital Plc, said:
“OMO has become the CBN’s central instrument for liquidity management, price stability, and attracting foreign inflows. Collectively, these measures are boosting investor confidence and reinforcing Nigeria’s position as an investment destination.”
With N784 billion set to flow into the system this week, the CBN’s latest OMO issuance underscores its commitment to tightening liquidity, stabilizing the naira, and sustaining its disinflation strategy.
