LAGOS (Reuters) – Nigeria’s naira weakened marginally on Monday due to strong dollar demand but the local currency was expected to be supported later in the week by energy firms selling forex, traders said.
The local unit closed at 158.75 to the dollar, slightly weaker than the 158.70 it closed on Friday.
Traders said about $141 million sold by a unit of French oil firm Total on Friday helped to limit losses and more energy firms were expected to come to the market this week.
Most energy companies operating in Africa’s top crude exporter sell dollars to banks on a monthly cycle to get naira for their domestic obligations.
The naira has been maintained in a 158-159 band against the dollar since last month, mainly due to support provided by international oil companies selling forex and the central bank’s monetary tightening measures.
“My expectation is that the naira should strengthen in the week as more oil companies sell dollars,” one dealer said.
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