December 10, 2012 / 2:16 PM / 5 years ago

Nigerian naira falls on strong dollar demand

LAGOS, Dec 10 (Reuters) - Nigeria’s naira currency eased marginally against the U.S dollar on the interbank market on Monday after a sudden dollar buying pressure from a lender depressed liquidity in the market, traders said.

The naira closed at 157.15 to the dollar on the interbank, weaker than the 157.10 to the dollar on Friday.

Traders said dollar sales by three oil companies, units of French Total $55 million, Agip, $10 million and unspecified amount by Royal Dutch Shell, initially buoyed dollar liquidity in the market and helped the naira firmed around 156.90/157.05 figure intraday.

“The market was sufficiently liquid to support the naira with the large dollar sales by the NNPC (state-owned energy company) on Friday and three others oil companies today, but last minute buying by some banks depressed the market,” one dealer said.

NNPC sold around $400 million on Friday, dealers said.

Traders said the NNPC dollar was sold to the some lenders almost at par with prevailing rate in the market, leaving little room for margin and reduced its impact on the naira value in the market.

The currency of Africa’s top energy producing country has been supported by large dollar flows from energy companies selling dollars to meet month-end domestic obligations, and by offshore investors buying local debt in the past few weeks.

Traders said the naira should remain stable around the 157-157.40 in the near term as demand for dollar decline towards the end of the year.

On the official window, the central bank sold $56.5 billion to lenders at 155.76 to the dollar, compared with $154.28 million at the same rate last week. (Reporting by Oludare Mayowa; Editing by Toby Chopra)

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