Nigeria Central Bank Says Will Stabilise Naira, After It Crosses N200

The Central Bank of Nigeria (CBN) is committed to sustaining a “stable and orderly” market, after a delay to a presidential election pushed the naira beyond N200 to the U.S. dollar for the first time, an adviser to the governor told Reuters on Tuesday.
The forex market was understandably nervous after the six-week delay to elections originally scheduled for February 14, but it was nothing to worry about, Ugochukwu Okoroafor said.
Okoroafor said the naira was under speculative attack, as there had been no fundamental change to Nigeria’s economy to warrant the pressure on the currency. 
The naira hit a new record low of N200.02 to the dollar on Tuesday despite a central bank intervention to try to halt its slide.
The unit fell 1.4 per cent from its opening value of N197.30 to the dollar, Thomson Reuters data showed. The central bank sold an undisclosed amount of dollars but it was not sufficient to support the naira, dealers said. 
Yesterday, the naira currency opened at record low on Monday on thin trading as the interbank markets digested the news that Nigeria would delay its presidential election for six weeks due to an Islamist insurgency in the north, dealers said.
The naira opened at a record low of N194.75 to the dollar, and quickly fell 1.1 percent to N196.05, compared with its previous close of N193.90 on Friday.
Nigeria’s electoral commission said late of Saturday it would postpone the Feb. 14 presidential election until March 28 due to security concerns. 
Last week, the naira depreciated by 337bps against the US Dollar to close at N193.93 at the inter-bank currency market. Despite oil prices showing signals of rebounding, and the CBN intervening in the currency market (with the latest being the direct sales of $30,000 to the Bureau de Change (BDC) operators on Friday), the pressure on the local currency persisted. At this week’s Retail Dutch Auction System (RDAS) auctions, the CBN offered US$400million and sold $398.7million at a marginal rate of N168/$. Against the Pound, the local currency fell by 1.5bps but gained 0.2bps versus the Euro to trade at N281.94/£ and N222.04/€ respectively.

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