Central Bank of Nigeria
Open Market Operations, Nigeria
In line with the objectives of the monetary policy in 1994, the CBN achieved a substantial reduction of its holding of treasury bills through open market operations that were aimed at slowing down the growth of base money and money supply. While the volume of open market sales suffered apparently from the initial market reactions to the budget for fiscal 1994 and later the political and industrial unrest, such sales reached record levels in the fourth quarter of the year. However, OMO largely responded to the short-term portfolio preferences of banks and did not translate into an overall pressure on their reserve position. The moderation that occurred in the growth of base money and money supply were both traceable to the slow-down in the growth of government borrowing from the Central Bank. In the year ahead, the role of OMO in controlling monetary and credit growth is therefore likely to be secondary to the governments fiscal out-turn and the impact of the .new exchange rate policy on overall liquidity in the economy.
CBN Economic and Financial Review
Akatu, P. A. & Ibeabuchi, S. N. (1995). Open Market Operations in 1994. CBN Economic and Financial Review. 33(1), 13-34.