CBN pumps more dollars into the market

The Central Bank of Nigeria said on Monday it sold $80 million to retail customers and another $100 million in currency forwards to increase dollar liquidity and support the naira.

The central bank said in a statement it sold $80 million to cover consumer demand and another $100 million via the wholesale forward market.

Traders said banks offered central bank dollars to customers at 375 naira.

Since last year, Nigeria has been battling dollar shortage caused by the sharp drop in  oil revenues .

This  weakened the Naira  on the black market, where it trades far lower than the official interbank rate of 305 naira to the dollar.

The naira, which had weakened to 520 to the dollar on the black market, firmed to a more than three-months high of 460 on Friday, after several interventions by the central bank on the official market.

Central bank spokesman Isaac Okoroafor said the central bank would ensure a steady supply of foreign exchange to the market. Its efforts, he said, were starting to narrow the black market rate.

The central bank has been  under pressure from the government to narrow the gap between the official and black market rates, has effectively devalued the naira for consumers, offering to sell them dollars at about half the premium the black market charges.