Nigerian Naira Erases Gain as Central Bank Sells Fewer Dollars

Nigeria’s naira erased gains after the central bank sold fewer dollars at a currency auction than a week earlier.

The currency of Africa’s second-biggest economy rose as much as 0.1 percent to 158.10 per dollar before trading unchanged from the March 22 close at 158.25 per dollar by 3:41 p.m. in Lagos, according to data compiled by Bloomberg.

The Central Bank of Nigeria is the biggest source of foreign currency, selling to lenders at twice-weekly auctions to help manage the exchange rate. The Abuja-based bank offered $300 million today and sold $276.6 million, compared with $280 million at the March 20 sale, it said in an e-mailed statement.

The naira gained earlier today on speculation that oil companies in Africa’s biggest crude producer would sell dollars to pay for end-of-the-month expenses. That’s the country’s second-biggest source of foreign currency.

“The amount sold by the central bank didn’t go round as oil company sales are still awaited,” Abubakar Mohammed, chief executive officer of Lagos-based Forward Marketing Bureau de Change Ltd., said by phone.

The yield on the country’s 16.39 percent domestic bonds due January 2022 dropped four basis points to 11.20 percent in the secondary market, according to March 22 data compiled on the Financial Markets Dealers Association website. Yields on the $500 million of Eurobonds due January 2021 declined four basis points to 4.288 percent today.

Ghana’s cedi gained for a second day by 0.1 percent to 1.9385 per dollar in Accra.

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