AGAINST expected liquidity this week, the naira appreciated at the Central Bank of Nigeria's (CBN) official market on Monday beginning the month on a positive note.
Specifically, the Naira appreciated to N148.41 from N148.61 shedding 20 kobo from last week's rate.
At the Wholesale Dutch Auction System (WDAS) held March 1, 2010, the apex bank offered $250 million but sold $176,633,828.
The Naira last week also remained stable after the CBN met demand by selling $250 million at N148.60 a dollar compared to $150 million at N148.71 a dollar.
At the interbank market last week, the nation's currency remained firm against the U.S dollar following large month-end dollar sales by some oil companies to selected banks.
Against the British pound, the Naira appreciated to N227.50 gaining 156 kobo and also rose from N201.32 to settle at N200.45 against the Euro. At the parallel market the Naira remained stable at N151.5.
Last week Monday demand stood at $289.21 million allowing the Naira appreciate to N150.42 a dollar at the interbank from N150.52 following dollar sales by state-run energy firm NNPC and news of plans by two oil majors to sell more dollars last week Tuesday.
Traders said the expected additional dollar inflows from the oil firms helped tame demand pressure at the bi-weekly auction, providing support for the naira.
Last month the Federal Account Allocation Committee (FAAC) release funds for the month of February to the three tiers of government causing inter-bank market to go awash with liquidity.
Available data last week showed that the 7-day Nigerian Interbank Offered Rate (NIBOR) closed the week at 4.96 per cent, a 67-basis-point decrease from the previous week's figure of 5.63 per cent. On the other hand, the 90-day NIBOR closed the week at 12.42 per cent, a 125-basis-point decrease from the previous week's figure of 13.67 per cent.
The Naira had weakened previously against the U.S dollar on the interbank market after the apex bank failed to meet demand at its foreign exchange auction the previous.
Meanwhile, following the Central Bank of Nigeria's Monetary Policy Meeting, Nigeria's benchmark interest rate is expected to remain unchanged as the removal of fuel subsidies threatens to keep inflation above 10 per cent, a survey of economists showed.
The monetary policy rate will remain at 6 per cent, according to seven of eight economists surveyed by Bloomberg. The main lending rate to commercial banks will probably be maintained at 8 per cent and the borrowing rate at 2 per cent.
Source:© Copyright Guardian
|
