Nigeria’s naira headed for the first monthly decline since June against the U.S. currency as companies sought dollars to import consumer goods for holidays next month.
The currency of Africa’s largest oil producer depreciated 0.1 percent to 157.41 a dollar as of 12:05 p.m. in Lagos, the commercial capital, and headed for a monthly drop of 0.2 percent, according to data compiled by Bloomberg.
“Dollar demand increased this month, driven by companies bringing in consumer and household goods for Christmas and year-end celebrations in December,” Tunde Ladipo, chief executive officer of Lagos-based Valuechain Investment Ltd., said by phone today. “Demand is also boosted by companies bringing in gasoline.”
The drive for consumer goods rises during religious festivities in Nigeria, a nation of more than 160 million people with a population almost evenly split between Muslims and Christians. The country also relies on imports to meet 70 percent of its fuel needs because of inadequate refining capacity, according to the Petroleum Ministry.
The Central Bank of Nigeria held its benchmark interest rate at a record high 12 percent this year to ease inflation pressures and stabilize the naira. Inflation, which accelerated for the first time in four months to 11.7 percent in October, remains above the bank’s target of less than 10 percent.
Yields on 10-year naira debt fell six basis points to 12.3 percent, according to yesterday’s prices compiled on the Financial Markets Dealers Association website. Borrowing costs on the nation’s $500 million of Eurobonds due January 2021 fell two basis points to 4.256 percent.
Ghana’s cedi appreciated for the first time in nine days, rising 0.1 percent to 1.9075 a dollar in Accra, the capital.