Business
Naira Still Stable At Forex Market
Against expected increase in liquidity in the foreign exchange market, the exchange rate of naira against major currencies remained stable as at the second day of trading in the new year.
Specifically at the official market, the naira sold for N147.6 same as it was on the first day while the euro sold for N211.865 it exchanged on Monday.
Also, against the British Pound, the Naira sold for N239.9, same as it was during the period under review.
At the parallel market, the US dollar sold for N150.00 down from N152 last week while at the bureau de change, the dollar exchanged for N149.9.
“This period is usually one that is characterised by lower demand for the dollar as many Nigerians coming from abroad bring in the much needed foreign currencies said Mr. Wale Abe a financial expert.
At the wholesale Dutch Auction System (WDAS) trading held on Monday the Central Bank of Nigeria offered $200 million as against $300 million sold last week, while $200 million was sold as against $300 million the previous week.
Interbank lending rate edged up to 3.16 per cent on average this week, compared to 30 per cent last week, as the system remained liquid enough to support demand for credit, a dealer said.
The Open Buy Back (OBB) was flat at 2.5 per cent below the Central Bank’s 6.0 per cent benchmark interest rate.
Overnight placement was also unchanged at 3.0 per cent, while call money climbed to 4.0 per cent from 3.5 per
cent the previous week.
Inflows of about N56 billion in cash calls to Nigeria’s’ oil joint venture partners and the redemption of about N63 billion in promisory notes by the Central Bank boosted liquidity last week.
Meanwhile, the Central Bank, at the second day left its benchmark interest rate unchanged as it aims to ease a credit shortage caused by last year’s banking crisis.
At the monetary policy meeting held Tuesday CBN governor, Lamido Sanusi said the monetary policy rate would be held at six per cent.
CBN, last year, bailed out the banking industry with N620 billion ($4 billion) to ease a credit squeeze and sacked eight bank chiefs.
The apex bank expects legislators to approved the creation of a company to buy bad debts from commercial banks in about three weeks Sanusi said Tuesday.
The key rate was last cut by 1.75 percentage points in April.