The naira inched up marginally against the U.S dollar on the inter-bank on Monday, as a result of dollar sales by Shell and declining demand for foreign exchange at the official window. The naira closed at N157.60 to the dollar on the inter-bank market, stronger than the N157.65 it closed on Friday. Bankers said the market reacted to the dollar inflows from Shell petroleum and signs of declining demand at the official window where the central bank sold less dollars than it initially offered for the third consecutive time in a row.
The central bank sold $138.70 million at N155.90 to the dollar, compared with $113.53 million sold at N155.90 to the dollar at the last auction on Wednesday. The regulator had initially offered $150 million at the bi-weekly forex auction.
Bankers said more importers now buy dollars at the inter-bank because of the improved liquidity in the market and short turn around time for transactions. Bankers also said more oil multinationals are expected to sell dollars in the coming days as part of the monthly cyclical sales to obtain naira for their local obligations. “Some offshore investors are also expected to bring in some dollars to invest in the bond auction holding this week and this will further increase the level of dollar liquidity in the market and help the naira value,” another dealer said. DMO plans to auction N70 billion in 2019 and 2022 bonds on Wednesday.
