Nigerian naira dips; fall offset by NNPC dollar sales
December 29, 2011
The Nigerian naira closed marginally lower on Thursday, inching down in late trade as importers bought dollars to meet year-end obligations.
The local currency closed at 163.10 to the dollar compared to 163.05 on Wednesday, traders said.
"We still have some demand from companies trying to balance their dollar accounts for the year, but increased (dollar) inflows also helped to check the decline of the naira," one dealer said.
Traders said state-owned energy company NNPC sold about $350 million on Friday, its second such transaction this month, and dollar inflows from some foreign investors also helped to provide liquidity.
"Demand (for dollars) should slow down in the near term and the naira hold steady until the reopening of the official (central bank) window next week when a new direction for the currency could be established," another dealer said.
The central bank expected to reopen the official bi-weekly foreign exchange market on Jan. 4, having closed it for the year on December 21.
At its last auction for the year, the central bank sold $200 million at 156.70 to the dollar, a sum and rate it had maintained through the month.