Traders say they expect Nigeria’s naira to extend gains into the coming week thanks to strong dollar supply from foreign investors, exporters and oil companies while demand is moderate.
The naira was quoted at 1,356 to the U.S. currency on the official market on Thursday, compared with 1,374 a week earlier.
The currency was changing hands at 1,404 to the dollar in street trading .
“We may see … (a) further rally,” one trader said. “Yields are still attractive for foreign investors, so we should still see more (FX) flows coming to Nigeria,” the trader added.
However, Ghana’s cedi is seen trading with a weakening bias due to significant corporate foreign-currency demand on the interbank market driven by energy and manufacturing companies.
LSEG data showed the cedi trading at 11.24 to the dollar compared with 11.19 a week earlier.
“The cedi is likely to remain on the back foot against the dollar,” a trader said.
“Despite increased allocations from recent central bank FX auctions, demand remains firm and backlogs persist, led primarily by the energy sector as global oil prices remain elevated,” the trader continued.
Another trader said the local unit would continue to face headwinds in the short term as FX liquidity remained thin and the market was struggling to fill unmet demand from central bank auctions.
