Naira depreciates

The value of the naira on Wednesday depreciated as demand for U.S. dollars overcame an intervention by the Central Bank of Nigeria and an injection of dollars by a major oil firm. The naira closed at N164.75 to the dollar, weaker than Tuesday’s close of N164.10 naira.

Dealers said the Nigerian central bank and the local unit of Royal Dutch Shell sold an undisclosed amount of hard currency to banks. The intervention did not help.

“Demand was strong while the dollar sales by both the central bank and Shell was not enough to calm the market,” one dealer said.

On Monday, the naira dropped to its weakest in more than two years, but it recovered the following day after the central bank intervened. “Unless the central bank sustains its intervention, the naira could weaken to 165 and above in the coming days,” another dealer said.