Foreign exchange reserves climbed by 30 per cent to hit a more than 32 month high of $42.56bn by October 29, the latest figures from the Central Bank of Nigeria showed on Wednesday.

Forex reserves in Nigeria stood at $32.72bn last year; the reserves rose by 3.4 per cent from September 28 to October 29 and have not been this high since February 11, 2010 when they stood at $42.74bn.

The reserves had risen to more than 29-month high of $41.12bn by September 26.

The CBN had reportedly said that the nation’s external reserves had continued to grow since August 1, 2012.

In a separate development, the CBN said on Wednesday that it planned to raise N129.8bn ($827m) by selling treasury bills with maturities ranging from three months to one year at its regular twice monthly debt auction on November 8.

The bank said it would issue N32.05bn in 91-day paper, N50bn in 182-day bills and N47.78bn in the 364-day paper.

Meanwhile, the naira traded flat against the United States dollar on the inter-bank on Wednesday as expectations of dollar inflows from energy companies and offshore investors buying local debt provided forex liquidity.

The naira closed at N157.10 to the dollar, the same level it closed on Tuesday.

Dealers said the naira initially weakened to N157.30 intraday but firmed after dollar sales by the local unit of Addax petroleum and some lenders selling hard currency to keep within the stipulated Central Bank of Nigeria open limit position for banks.

Reuters quoted a dealer as saying, “We saw growing demand in the market initially because of cheaper rate at the inter-bank, which saw the naira testing N157.25/157.30 level, but later closed firmer as some banks sold down their positions.”

Traders said the naira was seen trading within the present band for the rest of the week because of anticipated dollar inflows from offshore investors buying local debt and from the Nigerian National Petroleum Corporation.

The CBN sold $50m at N155.74 to the dollar at its twice weekly auction on Wednesday, compared with $43.5m sold at N155.76 to the dollar on Monday.

Traders said more importers now preferred to buy dollars at the inter-bank market because it was cheaper than the rate at the CBN window because the CBN charges one per cent commission on every dollar sold at its auction.

Source: Punch