Naira down to N161.7 to dollar as CBN fails to supply dollar

By The Rainbow

Nigerian currency, the Naira, sold at N161.5 to the dollar at the interbank market fuelling fears that the unsettled international financial market may have a longer-than-expected dig on the currency.

The fall represents its weakest since June 14 when it closed at N162.7 to the dollar.

The slide in the currency's value it was learn was  as a result of the Central Bank of Nigeria's (CBN) failure to intervene in the market by selling dollars.

The naira closed at N160.50 to the dollar the previous day.

'Demand for the greenback remain strong in the market, while the sales of $12 million by Agip was too little to support the naira,' one dealer said.

Traders said the apex bank failed to sell dollars directly to some banks outside its regular twice-weekly auction as it had done in the last two weeks, causing the naira to lose value.

CBN  had sold about $3 billion between May 22 and June 24 at its twice-weekly foreign exchange auction, plus an unspecified amount sold directly to banks, in its bid to reduce pressure on the local currency.

At the regular forex auction, the central bank sold $300 million at 155.75 to the dollar as against  $500 million sold at the same rate on Monday.

Nigeria's foreign exchange reserves fell 0.16 percent month-on-month to $48.33 billion by June 24, the lowest level in more than three months, data from central bank showed on Wednesday.