The naira closed stronger yesterday at the interbank market as Addax Petroleum and Agip released about $13m into the market, causing increased liquidity.
The naira which sold at 161.25 to the dollar sold at 161.10 to the dollar on Monday as dollar flows from the two energy companies and banks increased liquidity and supported the local currency.
Traders said a unit of Addax Petroleum sold $10m and Agip sold about $3m to banks, while some banks that bought dollars from the Nigerian National Petroleum Corporation (NNPC) last week sold a portion of their holdings in the market on Monday.
“The market is comfortable with the level of dollar liquidity, that was the reason the naira is trading at this level today,” one dealer said.
The naira had risen to 160.10 to the dollar on the interbank market last Monday after NNPC sold around $400m, but fell in the week as demand squeezed out part of the supplies. But traders expected the naira to strengthen this week.