US dollar losing N1.20k at the interbank market.

The efforts of the Central Bank of Nigeria (CBN) at maintaining stability in the foreign exchange has been defied as naira yesterday weakened against the US dollar losing N1.20k at the interbank market. The CBN yesterday at the 234th Meeting of the Monetary Policy Committee (MPC) retained its benchmark lending rate at 12percent for a 12th consecutive meeting to bolster the naira and keep inflation under control.
Naira yesterday closed at N160.60/$ compared to N159.40/$ the previous day, data from the Financial Markets Dealers Association (FMDA), have revealed.
This year alone, naira has depreciated 2.4 percent against the dollar even as analysts anticipate more pressure on naira following President Goodluck Jonathan’s estimate of 12 percent drop in oil and gas revenue in 2014.
However, the CBN on Monday sold $300 million to 17 deposit money banks at N155.76/$ at its bi-weekly Wholesale Dutch Auction System (WDAS).
The local currency remained stable at the bureau de change closing at N162.50/$. Also at the official and parallel markets, naira remained unchanged to close at N155.76/$, and N163.00/$ respectively.
Money market yesterday experienced liquidity squeeze as the Nigerian Interbank Offered Rates (NIBOR) increased across tenor buckets.
Consequently, call tenor climbed to 13.75 percent from 13.50 percent the previous day. Similarly, 7 days, 30 days and 60 days rose from 13.41 percent, 13.70 percent and 14.16 percent respectively the previous day to 14.00 percent, 14.25 percent and 14.66 percent respectively.