The continued drop in the value of the Naira has adversely affected the volume of foreign exchange (forex) traded at the Central Bank of Nigeria (CBN) - moderated forex market.

Between February 7 and 14, only $400 million worth of forex was sold to bidders in two trading sessions. The apex bank had on February 7 sold $200 million worth of forex to 17 participating banks. The highest bid rate was N150.61 to a dollar while the lowest bid rate was N150.25 to a dollar. On February 14, 20 participating banks bought another $200 million worth of forex.

The Naira has continued to fall and had on Monday maintained an Exchange rate of N150.5 against the dollar. The report added that the tightness experienced in the inter-bank market the last week may cease over federal allocations state governments. This no doubt, may decrease the inter-bank rates marginally this week. About N414 billion was released last week from federal accounts, helping to boost liquidity in the system.

Meanwhile, the Debt Management Office (DMO) said last week that it sold N66.5 billion in five-year and three-year sovereign bonds at its second debt auction of the year.

It sold N30 billion in the five-year and N36.5 billion in the three-year instruments at Wednesday’s auction with marginal rates of 11 per cent and 9.25 per cent respectively, slightly lower yields than at the previous auction in January.

The five-year bonds were issued at a marginal rate of 11.13 per cent last month, while the three-year instruments were issued at 10.40 per cent.

"However, the original coupon rates of 5.50 per cent and 4.00 per cent for the three-year and five-year respectively will be maintained," the debt office said. Both instruments were first issued in 2010 and have since been reissued on a monthly basis. Total subscription stood at N140 billion compared to N137.45 billion last month. Increase in subscription to has also been linked to the budgetary allocations to the three tiers of government from federation accounts.