Naira falls on strong demand for dollars

The naira weakened against the U.S dollar at both the inter-bank and CBN auction yesterday as demand for the dollar outstripped supply at both markets. The local currency closed at N159.52 to the dollar at the inter-bank, weaker than the N156.40 a dollar it closed with on Friday.
Bankers said the CBN failed to clear all demand at its auction, while request from end-users excluded from the official window exerted more pressure on available currency at the inter-bank. The central bank three weeks ago banned petroleum dealers, sourcing dollars at its official window for imports and restricted sales at its auctions to foreign firms taking the currency offshore because they can buy from the inter-bank. On the bi-weekly auction, the central bank sold only $200 million at N150.25 to the dollar, short of the $242.34 million demanded and the $345.12 million sold at N150.05 to the dollar at last Wednesday’s auction.