By Obinna Chima
The naira was stable against the United States dollar at the fourth auction of the Central Bank of Nigeria’s (CBN’s) Wholesale Dutch Auction System (WDAS) held Monday due to moderate trading on the greenback.
Specifically, the local currency maintained the N156.69 to a dollar it attained last Wednesday at the end of yesterday’s auction.
Data obtained on the CBN’s website showed that whereas the apex bank offered a total of $200 million yesterday to the 13 banks that participated in the auction, the total amount sold was $198.128 million.
Dealers informed THISDAY that most operators could not bid for the greenback Monday, due to the strike and protest by labour and civil society groups over the fuel subsidy removal. The strike was however called off yesterday.
But just like the previous sessions this year, the CBN failed to state the amount of demand at the bi-weekly auction on its website.
Attempt by THISDAY find out why the apex bank had not been publishing the total amount demand was abortive as the CBN's Spokesman, Mr. Mohammed Abdullahi, failed to reply a text message sent to him.
The CBN had offered a total of $200 million last Wednesday while total amount sold stood at $171.820 million.
CBN Governor, Mallam Sanusi Lamido Sanusi had argued that for the economy to maintain a stable exchange rate, build up the forex reserves, maintain a stable rate of inflation and to attain a sustainable debt level, there was need to support the federal government decision.
“The fact that the commodity you consume has gone up by 50 per cent does not mean that the rate of inflation has gone up by 50 per cent. Given what is seen in terms of the very extreme and second round effect, we may end up having inflation rate, maybe not in January, but towards the end of the year, we may end up getting about 14- 15 per cent inflation rate. If it goes to 14-15 per cent, it would not be a good thing.
“There is no reason why a country that produces crude oil should not invest in the construction of its own refineries, no reason why we produce tomatoes and we import paste, no reason why we produce cotton and we don’t have textile. These are the kind of support that the government needs to provide,” the CBN Governor had said.