The Nigerian naira currency extended gains against the dollar for a third consecutive day on the interbank market yesterday, due to weak demand and anticipation of dollar sales by the state-owned energy company NNPC.
The local unit closed at 158.60 to the dollar, firmer than 158.8 it closed at on Friday.
Traders said the anticipation of large dollar sales by the NNPC persuaded some lenders to sell down greenback positions.
NNPC supplies most of the dollars traded on the interbank market, so the naira usually strengthens against the dollar on speculation it is about to sell another batch.
The naira has also been well supported in the past two weeks by higher than expected volumes of dollars sold by energy companies and central bank measures to limit dollar cash sales by banks to forex bureaux.
“We see the naira strengthening further this week based on the anticipated large dollar sales by the NNPC any time from now,” one dealer said.
Information from Daily Trust was used in this report.