FG, banks lodge 13.9trn with CBN in one month


The Central Bank of Nigeria (CBN) received N13.97 trillion deposits from the Federal Government and commercial banks in 30 days, the apex bank’s economic report released on Monday has shown.

Further analysis of the report, which is for the last month of 2019, showed a dip in private sector deposit with the apex bank. It also showed that currency outside banks dipped.

Of the total deposits at the CBN, the shares of the Federal Government, banks and the private sector were 45.7 per cent, 38.6 per cent and 15.7 per cent, respectively, the report added.

According to the report, reserve money rose by 6.4 per cent to N7.44 trillion with the upward movement in reserve money showing, mainly, the eight per cent increase in deposits of banks with the CBN.

The currency-in-circulation, on month-on-month basis recorded 2.5 per cent increase, growing to N2.55 trillion in contrast to the decline of 0.7 per cent at the end of the preceding month.

During the review period, the key financial market indicators remained relatively stable. Movements in domestic money market rates were influenced, largely, by the level of liquidity arising from inflow, such as fiscal disbursements, maturing CBN bills and Federal Government securities and outflow from the sale of CBN bills, FGN securities and provisioning settlement for foreign exchange purchases.

The stability at the foreign exchange market could be attributed to the sustained intervention by the CBN.

In line with the bank’s tight monetary policy, excess liquidity, arising from maturing CBN bills and fiscal injections, was consistently mopped up through Open Market Operations (OMO) auctions. The impact of the new CBN directive on OMO auctions, had seen portfolio switch from the money market to the capital market, leading to a crash in treasury bill rates.

In the month under review, OMO auctions culminated in the withdrawal of N694.83 billion as at November 26, 2019 through the sale of CBN bills tenored at 82-364 days, with stop rates ranging from 11.5 per cent to 13.3 per cent. This represented a decrease of 60.9 per cent, compared with N1.77 trillion sold in October 2019.

The CBN report also showed that federally-collected revenue (gross) stood at N858.92 billion within the review period. This was below the monthly budget estimate and the receipts in October by 31.1 per cent and 3.9 per cent, respectively. Oil and non-oil receipts (gross), stood at N489.08 billion and N369.84 billion, in the review month, constituted 56.9 per cent and 43.1 per cent of total revenue, respectively.

The end-period headline inflation, on year-on-year and twelve-month moving average bases, was 11.85 per cent and 11.35 per cent, respectively, in November 2019, compared with 11.61 per cent and 11.30 per cent, in October 2019.

Foreign exchange inflow into, and outflow from, the CBN in November 2019 were $3.72 billion and $4.31 billion, respectively, resulting in a net outflow of $0.59 billion. Aggregate foreign exchange inflow into, and outflow from, the economy were $9.84 billion and $4.70 billion, respectively, resulting in a net inflow of $5.14 billion. Foreign exchange sales by the CBN to the authorised dealers amounted to $2.84 billion, in the review period, compared with $3.17 billion in the preceding month.

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