CBN sold $1.9bn, naira lost 35kobo in January 2012

The Central Bank of Nigeria (CBN) sold $1.919 billion through the Wholesale Dutch Auction System (WDAS) session in January, while the naira depreciated by 35 kobo during the month. At the last WDAS session held yesterday, CBN sold $250 million while the naira depreciated by 20 kobo.
Result of the auction, conducted by the CBN show that the official exchange rate raised to N157.05 per dollar from N156.85 at the previous auction. The depreciation was triggered by demand pressure as the amount of foreign exchange offered by the apex bank remained $250 million per auction.
Reflecting the demand pressure in the market, the interbank exchange rate raised N161.4 per dollar from N161 on Friday, indicating 40 kobo depreciation. Cumulatively, the CBN has sold $1.919 billion, while the naira has depreciated by 35 kobo.
The apex bank conducted eight foreign exchange auctions in January selling $1.919 billion. This represents 60 per cent increase when compared to $1.2 billion sold in December.
Despite the increased sales, the official exchange rate rose to N157.05 per cent from N156.7 per dollar at the beginning of the year. This translated to 35 kobo depreciation of the naira in the first month of the year.
The naira also depreciated by 180 kobo at the interbank market as the interbank exchange rate rose from N159 per dollar at the beginning of the year to N161.4 as at the close of business.