Nigerian naira up 0.14 pct on oil firm dollar sale

Emefiele

The Nigerian naira firmed 0.14 percent against the U.S. currency on Monday, after the local unit of French oil company Total sold around $101 million in the interbank market, dealers said.
The unit closed at 162.57 naira, firmer than Friday's close of 162.80 naira. It had initially weakened to 162.80 naira at intraday trade before the oil company dollars hit the market, dealers said.
"I expect more oil companies to sell dollars and the naira to trade within a tight band of 162.5 and 163.10, because there is still demand out there," one dealer told Reuters.
The central bank offered to sell $350 million at an auction on Monday, while Italian oil company Eni called for bids to sell $10 million at market close. The outcome of these sales will set the pace for Tuesday's rate.
Dealers said demand for dollars was coming from foreign investors repatriating dividends from the equity market abroad, foreign airlines converting naira ticket sales and bureau de change buying hard currency for their clients.
Nigerian construction firm Julius Berger paid a dividend of 2.70 naira each on Friday, sending its shares up the maximum 10 percent allowed on the local bourse.
Dealers said they expect the central bank to intervene once the naira crosses the 163.10 resistance level, which could happen if oil company dollars dry up. Oil firms operating in Nigeria normally sell dollars monthly to meet their naira obligations.
"What is helping the naira is oil company inflow ... if not 163.10 is where traders will start to go short," another dealer said.