Business Naira Gains 1.03% To Close At 386 At Parallel Market


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Nigerian naira on Friday gained 1.036 per cent to 386 at the parallel market after the Central Bank of Nigeria (CBN) sold treasury bills to soak up liquidity from the banking system in a bid to curb pressure on the local currency.

The currency remained against the Pound sterling and Euro to close at 495 and 420 respectively at the same market.

At the official market, the naira closed flat at 305.6 kobo.

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Traders said the CBN sold about 17 billion naira ($55.81 million) worth of open market operations (OMO) paper on Friday and also soaked up about 110 billion naira in bonds settlement.

"The interbank rate ranged between 20-50 percent intraday because of the huge amount of liquidity soaked out of the market by the Central Bank," one trader said.

Nigeria has stepped up the frequency of treasury bill sales recently to soak up excess liquidity in a move to curb pressure on the local currency, leaving the market dry and banks scrambling for cash to cover their positions at higher borrowing cost.
 
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