Nigeria’s naira headed for the highest in two weeks against the dollar after foreign investors bought the nation’s debt and on support from high oil prices.
The currency of Africa’s biggest oil producer advanced 0.3 percent to 157.2 per dollar, the strongest on a closing basis since Feb. 23, at 12:20 p.m. in Lagos, heading for a second weekly gain.
Oil rose for a third day in New York on speculation that rising U.S. payroll numbers and an easing European debt crisis will spur demand for crude. A Central Bank of Nigeria sale of 150.1 billion naira ($955 million) of treasury bills on March 8 was oversubscribed, bids totaling 328.8 billion naira, with yields on 364-day notes at 15.57 percent.
“We’ve experienced foreign investors coming into” bonds and treasury bills, Edgar Ebinum, an analyst at Lagos-based Cowry Asset Management Ltd., said by phone today. “The oil price has been upbeat and it has a way of strengthening our external reserves and we expect the CBN to maintain their intervention strategy over time.”
High borrowing costs have fueled demand from foreign investors seeking better returns, central bank Governor Lamido Sanusi said Feb. 28. An auction last week for 35 billion naira of 2022 bonds sold at a yield of 15.893 percent was 2.35 times subscribed.
The central bank has sold $300 million to lenders at two foreign-exchange auctions this week. The regulator, based in the capital Abuja, offers dollars at auctions on Mondays and Wednesdays to maintain exchange rate stability.
Ghana’s cedi climbed 0.2 percent to 1.7102 per dollar in Accra.
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