Naira Steadies as Traders Anticipate Rates Stability in Week Ahead

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The Naira against Dollar
The Naira against Dollar
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Naira Steadies as Traders Anticipate Rates Stability in Week Ahead

. FG to raise N119.9bn through Treasury bill next week.

The Nigerian currency, Naira, on the fourth trading day of the week, remained steadied against the three major foreign currencies, after rebounded within the week over Pound Sterling and the Euro at the parallel market, just as foreign exchange traders optimistic that the Africa’s largest economy legal tender will remain stable across its exchange rates next week.

The Naira against Dollar
The Naira against Dollar

Although, they believed that as long as the Central Bank of Nigeria (CBN) continues to intervene and maintain tight money market liquidity to lure foreign inflows to support the currency that the Naira would sustain its gaining momentum across the forex markets.

However, the Federal Government of Nigeria has concluded all plans to raise a total sum of N119.94 billion from sales of treasury bills at an auction by next Wednesday on November 15, 2017, through the nation’s apex bank.

The Naira, as at close of yesterday’s trading closed at 363 to the US Dollar the same rate traded since the beginning of the week, even though it had recorded more gains over the Euro since Monday but was seen at 420 as at close Thursday’s trading activities.

The local currency, also, maintained an appreciated rate of 473 to the Pound sterling against 475 traded earlier in the week at the unofficial forex market.

However, forex dealers expected that the Naira will remain stable across its multiple exchange rates next week as the central bank continues to intervene and maintain tight money market liquidity to lure foreign inflows to support the currency.

The local unit has been hovering at around 360 naira for investors, the same level as the parallel market. On the official market, the naira has been quoted at around 305 per dollar for more than three months.

Traders say the market was comfortable at 360 level with quotes agreed over the phone and that clients withdraw their bids at weaker rates. Meanwhile the central bank has been selling dollars on the official market.

The bank plans to offer N32.44 billion in three-month paper, N22.82bn in six-month bills and N64.68bn of a one-year note. Results of the auction will be announced on the same day.

The central bank issues Treasury bills twice a month to help the government finance its budget deficit, curb money supply growth and provide an avenue for lenders to manage liquidity.

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