Naira Falls Most in Three Weeks on Dollar Shortage: Lagos Mover
The naira weakened for a second day on the Nigerian interbank market, heading for its biggest fall in three weeks, as import demand for dollars exceeded supply.
The currency of Africa’s top oil producer fell 0.4 percent to 158.18 a dollar as of 11:33 a.m. in Lagos, the commercial capital, the biggest decline on a closing basis since Aug. 20, according to data compiled by Bloomberg.
The Central Bank of Nigeria sold $180 million at a twice- weekly foreign-currency auction yesterday, the lowest since Aug. 29. The West African nation relies on imports to meet more than 70 percent of domestic fuel needs because of a lack of refining capacity, according to the Petroleum Ministry.
“Strong import demand, and a structural imbalance between dollar supply and demand” put pressure on the Nigerian currency, Ecobank Transnational Inc. strategists, led by Paris- based Paul-Harry Aithnard, wrote in an e-mailed note today.
Nigerian benchmark Bonny Light crude, which has risen 27 percent from a June low this year, snapped two days of gains, falling 0.2 percent to $115.11 per barrel.
The yield on Nigeria’s 7 percent domestic bonds due 2019 dropped 42 basis points, or 0.42 percentage point, to 13.36 percent, according to yesterday’s data on the Financial Markets Dealers Association website. Yields on the nation’s $500 million of Eurobonds due 2021 slid 1 basis point to 4.84 percent today.
Ghana’s cedi snapped four days of gains, falling by 0.1 percent to 1.9005 a dollar in Accra, the capital.
To contact the reporter on this story: Chris Kay in Abuja at email@example.com
To contact the editor responsible for this story: Vernon Wessels at firstname.lastname@example.org
Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.