Forex daily turnover rises as CBN auctions N100.84bn in Treasury Bills
by HOPE MOSES-ASHIKE
November 1, 2017 | 7:55 pm| | | Start Conversation
In this photo taken Tuesday Oct. 20, 2015, a money changer counts Nigerian naira currency at a bureau de change, where a dollar buys 222 naira compared to the official rate of 198, in Lagos, Nigeria. The IMF is pressing Nigeria to further devalue its naira currency amid uncertainty over the political and economic outlook for Africa's biggest oil producer and economy. Analysts said there's disappointment that President Muhammadu Buhari's long-awaited Cabinet list includes no economic stars. The naira has lost 25 percent of its value in the past year and the stock market has plummeted because of political uncertainty and halved prices for oil that provides most government revenue.(AP Photo/Sunday Alamba)
The foreign exchange daily turnover at the investors and exporters window on Wednesday rose to $165.83 million from $72 million recorded the previous day. This show a 130.31 percent increase.
The Central Bank of Nigeria (CBN) on Wednesday auctioned N100.84 billion in Treasury Bills as traders locked in yields in anticipation of higher liquidity from repayments.
After trading on Wednesday, the nation’s currency gained N0.43k to close at N360.40k per dollar as against N360.83k per dollar quoted the previous day at the investors and exporters window.
The central bank sold N74.76 billion of one-year debt at a rate of 15.53 percent, slightly lower than the previous auction, traders said. It had initially offered to sell N54.35 billion in that maturity.
The bank also sold N12.98 billion of six month bills and N13.09 billion of 91-day paper at 13.1 percent, unchanged from the last auction, according to traders who said around N420 billion in open market bills was expected to hit the banking system on Thursday, which spurred buying at the auction.
At the official inter-bank market, naira depreciated marginally by N0.05k as it closed at N305.85k on Wednesday from N305.80k traded on Tuesday, data from FMDQ indicated.
Nigeria’s central bank issues treasury bills regularly to help lenders manage their liquidity, curb rising inflation and provide naira to help the government fund its budget, Reuters report.
The CBN on Tuesday, injected another $195 million into the inter-bank Foreign Exchange market. The apex Bank offered the sum of $100 million to the wholesale window and intervened in the Small and Medium Enterprises (SMEs) segment with $50 million. The invisibles segment, comprising tuition, medical payments and Basic Travel Allowance received $45 million.
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