According to Reuters, the naira closed at 157.10 to the dollar on the interbank market, firmer than the 157.38 it closed on Friday. The naira has not been this high since Oct. 31, when it closed at the same level.
Traders said the naira was supported by dollar sales by units of ExxonMobil, which sold $50 million, and Agip $5 million, while Royal Dutch Shell and Nigerian Liquefied Natural Gas (NLNG) sold unspecified amount.
Increase in the flow of dollars mostly through the energy sector has enabled the naira to rise against the dollar.
“We have a lot of dollar flows to the market today from some energy companies, which helped to take out the few dollar demand and provided support for the naira,” one dealer said.
Because some importers have already built their stocks for the forthcoming Christmas, the demand for hard currency has continued to fall gradually. This is expected to reduce pressure on the local currency in the near term.
The naira is stabilizing at the present level of 157.10-157-50 to the dollar because of expected additional dollar flows from some oil companies and offshore investors buying treasury bills at an auction later in the week.
On the official window, the naira remained unchanged at 155.76 to the dollar as the central bank sold only $154.28 million compared with $200 million sold at the last auction.
Nigeria plans to sell 127.97 billion naira worth of treasury bills with maturities ranging from three months to one year on Dec. 5, at its twice-monthly auction. [ID: nL5E8MS5YH].
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