Foreign investors stage comeback to Nigeria, seeking high yields over interest rates
- Foreign investors are showing interest in Open Market Operations (OMO) and treasury bills auctions.
- Foreign Portfolio Investments on the NGX in February 2024 rose by 23% compared to January 2024.
- The Central Bank's consecutive rate hikes have attracted more investors while hurting lending to smaller businesses.
The return of foreign investors to Nigeria's government securities market is a positive development for the economy. The high-interest rates and influx of foreign capital will help stabilize the currency and provide the necessary funds for banks' recapitalization. However, it is important to monitor the impact on lending to smaller businesses and ensure that the trend continues in the long term.
