CBN sold $660m in special auction

Central Nank of Nigeria CBN said it has sold $660 million in three- and five- month currency forwards at an auction aimed at clearing a backlog of dollar demand, traders said.

Last Wednesday, the central bank had asked banks to bid in a special currency auction targeted at clearing backlog of dollar obligations of manufacturing, airlines, agriculture and petroleum sector. Currency Traders said the results of the auction was announced late Tuesday while payment for the dollar sales is due on Wednesday.

This is the first major dollar sales to the key sector by the central bank this year in a bid to spur growth and revive The ailing economy which slipped into recession last year due to currency crisis necessitated by drop in global oil prices.

Nigeria is in its first recession for 25 years, caused by the oil price drop which has cut the supply of dollars needed to fund imports.

The dollar shortage in the OPEC member, whose crude sales make up two thirds of government revenue, has caused many companies to halt operations and lay off workers, compounding the economic crisis.