Nigeria's interbank lending rate jumped to 2 percent on Tuesday from 1 percent on Monday after the central bank directed commercial lenders to fund their naira accounts to enable them take part in its forex intervention on Thursday, trader said.
Overnight lending rates jumped 100 basis points as the movement of naira cash for forex purchases drained liquidity in the market.
The central bank intervenes once a week at the interbank foreign exchange market to provide dollar liquidity for some eligible importers.
Last month the bank banned dollar sales to retail bureaux de change outlets, sending the naira to record lows on the black market, and later stopped daily sales to the interbank market, with the aim of conserving reserves which are down to an 11-year low.
The local currency closed at 199.40 to the dollar on the interbank market on Tuesday according to Reuters data, around the peg rate of 197 to the dollar.
The naira eased to 312 on the parallel market against 310 a dollar on Monday.
"The overnight rate went up today to 3 percent in early traded but declined to ... 2 percent after some banks funded their forex account," one dealer said.
Nigeria's interbank rate mirrors the level of naira liquidity in the banking system.
Traders said commercial lenders' credit balance with the central bank opened at 978 billion naira ($4.94 billion) on Tuesday before the bank called for funding for forex purchases. The central bank requires commercial lenders to fund their forex account 48 hours in advance of its intervention.