CBN sells Chinese yuan for first time as it deepens China ties

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The Central Bank of Nigeria sold yuan for the first time as it looks to boost commerce between China and Africa’s biggest oil producer and reduce the dominance of the dollar as a trading currency.

Governor Godwin Emefiele granted approval for the auction to take place on Friday, Isaac Okorafor, a spokesman for the Abuja-based lender, said in a text message. The CBN asked banks to bid for renminbi between 9:00 a.m. and midday, two people, who asked not to be identified because they’re not authorized to speak to the press about the matter, said. The results will probably be announced by Monday, they added.

While the central bank didn’t state the size of the sale or the exchange rate, allocations will be for businesses importing raw materials and machinery, one of the people said. The auction comes after Nigeria and China signed a naira-yuan currency swap worth the equivalent of $2.4 billion in May. Emefiele said the three-year deal would help increase trade and reduce pressure on the naira-dollar exchange rate by weaning Nigerian importers off the greenback.

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