Naira Set for Best Gain in 3 Weeks on T-Bills Sale
The naira snapped four days of declines against the dollar, gaining the most in more than three weeks after foreign investors bought Treasury bills.
The currency of Africa’s biggest crude producer rose 0.4 percent to 157.85 a dollar as of 2:57 p.m. in Lagos, the commercial capital, the biggest gain on a closing basis since Aug. 21. The naira has advanced 2.8 percent this year, the best performer in Africa according to data compiled by Bloomberg.
Treasury bill yields declined to the lowest in more than three months at an auction yesterday as investors bid for three times the 142.9 billion naira ($905 million) on offer, the central bank said today. JPMorgan Chase & Co. said last month that it is considering adding the West African nation’s debt into its government bond emerging market index series.
“Flows into the market have increased” supporting the naira, Adedayo Idowu, a Lagos-based analyst at Vetiva Capital Management Ltd. said by phone today. “Clearly a lot of those flows have been coming from off-shore investors.”
The yield on Nigeria’s 7 percent domestic bonds due October 2019 dropped nine basis points to 13.87 percent, according to yesterday’s data on the Financial Markets Dealers Association website. Yields on the nation’s $500 million of Eurobonds due January 2021 slid less than one basis point to 4.92 percent today.
Ghana’s cedi climbed 0.2 percent to 1.9275 a dollar in Accra, the capital.
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