The naira weakened for the first time in four days against the dollar as consumer imports increased before a Christian celebration.
The currency of Africa’s top oil producer declined 0.1 percent to 157.56 per dollar on the interbank market as of 3:39 p.m. in Lagos, according to data compiled by Bloomberg.
“Dollar demand has risen, boosted by commercial businesses making imports for the Christian Easter celebrations due early next month,” Sewa Wusu, currency analyst at Lagos-based Sterling Capital Ltd., said by phone. “Demand is also triggered by companies listed for oil imports next quarter.”
Africa’s most populous country of more than 160 million people, with Muslims and Christians almost at par, experiences higher imports of personal and household items during religious festivities. Nigeria approved a tender for 3.57 million metric tons of gasoline imports for the second quarter on March 12, the first this year. Fuel imports have been a leading source of pressure on the naira, according to the Central Bank of Nigeria.
Nigeria sold $200 million at a foreign-currency auction yesterday, with lenders buying the entire amount offered, the Abuja-based central bank said. The marginal rate, which is also used as the prevailing exchange rate, was 156.06 naira, unchanged from the previous sale on March 19.
The central bank left its key interest rate unchanged at 12 percent for a third consecutive meeting on March 20 to curb inflation and stabilise the naira. Inflation in the West African country declined to 11.9 percent in February from 12.6 percent a month earlier, the National Bureau of Statistics said March 19.
The yield on Nigeria’s $500 million of dollar bonds due 2021 fell 0.9 basis points to 5.441 percent. Borrowing costs of domestic bonds due 2015 rose one basis point to 15.46 percent, according to prices on the Financial Markets Dealers Association website.
Ghana’s cedi strengthened less than 0.1 percent to 1.7771 per dollar in Accra, the capital.