Nigerian naira seen rangebound on oil firms dlr sales, offshore inflows

Naira and dollar

Nigeria's naira is seen rangebound against the dollar as more oil firms sell dollars and offshore investors buy local debt in the wake of Nigerian 2024 bonds being included in JP Morgan's Government Bond Index.
The naira was trading at 162.16 to the dollar at 1421 GMT, from 162.05 at Wednesday's close.
The 2024 bond is due to be added to JP Morgan's Government Bond Index-Emerging Markets (GBI-EM) on Aug. 29, potentially triggering more offshore interest.
"We expect flows from the multinational oil companies and potential inflows from offshore investors buying local currency debt," Citibank's local unit said in a note to clients.
Many energy companies operating in Africa's biggest economy buy local currency to meet domestic obligations. Traders said the additional dollar flows could also trigger higher demand from importers who would take advantage of the cheaper dollars to bring forward their obligations.