By BABAJIDE KOMOLAFE
The naira depreciated by 29 kobo at the official market on Monday following 15 per cent rise in demand.

Result of the Wholesale Dutch Auction System (WDAS) session conducted by the Central Bank of Nigeria (CBN) shows that demand for foreign exchange rose to $229.136 million from $200 million at the last auction.

The CBN however offered and sold $200m hence a demand gap of $29.136m, which caused the official exchange rate to rise to N156.5 per dollar from N156.31 per dollar.

But the naira appreciated at the interbank market as the interbank foreign exchange rate dropped to N161.29 per dollar from N161.5 per dollar due to low demand pressure.

On the international scene, the euro extending last week’s gains against  the dollar and yen, after France and Germany said they want a rewrite of the European Union’s governing treaties to tighten economic cooperation in the region.

The 17-nation currency was supported as Italy’s cabinet approved a deficit-cut plan, easing concern the region’s debt crisis in worsening.

The yen and dollar weakened as stocks advanced. Sterling strengthened as an index of U.K. services unexpectedly gained and U.S. services expanded in November at the slowest pace since January 2010.

“It looks like they are taking the right steps, which is toward a stronger fiscal integration policy,” said Mark McCormick, a New York-based currency strategist at Brown Brothers Harriman & Co.

“They are trying to make up for some of the inherent flaws that the euro zone had in its design. You have a political union, a currency union, but you don’t a have single fiscal policy.”

Meanwhile, the Canadian dollar is turning into a haven for foreign-exchange investors shunning European turmoil and seeking the safety of the U.S. without the budget deficits or political gridlock.

The currency, which underperformed nine major peers in Bloomberg Correlation-Weighted Indexes in the first eight months of the year, has rebounded, topping all except the U.S. dollar and yen since.

As the U.S. struggles with a $1.3trn budget shortfall, AAA rated Canada may use rising commodity revenue and spending cuts to balance the budget within five years.

Bank of Canada Governor Mark Carney, will be the only central bank leader in the Group of 10 countries to raise interest rates next year, according to forecasts compiled by Bloomberg News.

Inflation has exceeded the bank’s 2 per cent target for 11 months as the economy grows at double the pace of the Group of Seven nations.

Canada’s six largest banks say the so-called loonie will gain versus the dollar even as the U.S. economy strengthens.

“There’s a North American story right now that is potentially very powerful,” David Watt, a senior currency strategist in Toronto at Royal Bank of Canada, the nation’s largest lender, said.

to financial uncertainty and less exposure to sovereign risk, then Canada has got a number of beneficial features,” he said.