Nigeria: Naira appreciates on parallel market after CBN dollar sales

*Central Bank of Nigeria, CBN.

*Central Bank of Nigeria, CBN.

24 December 2015, Lagos – The naira firmed to N266 to the dollar on the unofficial market on Wednesday, gaining 1.5 per cent after the Central Bank of Nigeria sold dollars to exchange houses and as demand for the US currency slowed, traders said.

The central bank sold $10,000 to each of more than 2,000 bureau de change operators, Aminu Gwadabe, the head of Nigeria’s bureaux de change association, told Reuters.

He said the intervention would be the last for the year. The naira had fallen to a record low of N280 to the dollar last week after the central bank advised commercial banks to limit how much customers could spend abroad using their debit cards.

“The pressure on the market has slowed because most businesses are closing down for the year, while the number of those travelling abroad has fallen,” Gwadabe said.

On the official interbank market, the naira closed at N199.50, some 1.26 per cent weaker than the central bank’s peg rate.

Traders said since the central bank closed its intervention window this week, the naira has been trading at two naira above the peg rate. The Nigerian money market re-opens next Tuesday.

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