Nigerian naira falls vs dollar on strike fears

Nigerian naira falls vs dollar on strike fears



Friday January 6, 2012 2:25pm

The Nigerian naira fell against the U.S dollar on the interbank foreign exchange market on Friday on fear the planned strikes and protests against a hike in fuel price could disrupt business activities next week.

The naira closed at 162.10 to the dollar, 1.32 percent weaker that the 159.95 to the dollar Thursday's close.

"Some importers are buying up dollars because of the uncertainty on the likely impact of the planned labour union strikes and protests against the withdrawal of fuel subsidy on their business next week," one dealer said.

Nigerian trade unions threatened on Wednesday to call a national strike starting next week, which they said would shut down large parts of the country's businesses, including the banking sector, if the government failed to restore a fuel subsidy.

Traders said the naira currency was under pressure on Friday as some importers buy up dollars to secure their obligations in case the planned strikes disrupt business activities and the foreign exchange auctions next week.

"People expect the naira to lose value next week unless the central bank increases dollar sales to the market and clears all demand at it auction, provided the auction is held because of the planned strikes by the labour union," another dealer said. 



Source: Reuters (Reporting by Oludare Mayowa)



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