Dollar sales keep Naira Stable but outside CBN band

The  naira was little changed on Thursday after the central bank increased the amount of dollars it sold at a twice-weekly auction the previous day, dealers said, citing ample of dollar liquidity on the interbank market.

The unit opened for trade at 179.53 naira to the dollar, up 0.21 percent from its previous close. It then stabilised at 180.25 at 1140 GMT, a range it has been trading at for the past three hours.

But the currency remained outside the central bank’s new target range of 160-176 naira to the dollar, which the bank set last week, when it devalued the naira by 8 percent to halt the decline to its foreign reserves.

At a separate forex auction late on Wednesday, the central bank sold $289 million at 168 naira to the greenback, more than the $200 million it offered, to meet demand for dollars.

Dealers said the market was also expecting the central bank to intervene to reduce volatility as it has done since it devalued the currency. Some commercial lenders were selling dollars on behalf of their clients, they said.

The central bank sold treasury bills on Wednesday with maturities ranging from three months to one year at an auction, to raise 129.17 billion naira (717 mln). Result of the auction is expected on Thursday.