Naira firms up, closes at 310.50 per dollar

The Naira on Tuesday closed at 310.50 against the dollar, higher than the previous day of 315.50.

The local currency traded $23 million at 280.50 just after the interbank market opened at N316.50.

Analysts and market commentators attributed the N280.50 rate to a dollar resale on the spot as outright currency forwards sold by the central bank.

However, Nigeria plans to raise N245.18 billion ($773.44 million) worth of treasury bills with maturities ranging between three months and a year on Aug. 3, traders said on Tuesday citing a central bank Treasury bill calendar.

 

The CBN also planned to issue N45.18 billion in 3-month debt, N80 billion of 6-month paper and N120 billion of 1-year bills in a Dutch auction. Indicative rates for the auction are 16 per cent for 3-month, 18 per cent for 6-months and 18.5 per cent for 1-year bills. Traders said the auction’s results will be published the day after the sale.

 

Yields on fixed income securities have been rising in recent months with the central bank mopping up naira liquidity to try to lure back foreign investors who sold naira assets following the plunge in the price of oil, Nigeria’s economic mainstay. The bank lifted interest rates by 200 basis points last week to 14 per cent to help fight inflation, which hit a 10-year high of 16.5 per cent in June.