(Adds naira close, dealers comments)
LAGOS, Dec 10 (Reuters) - Nigeria's naira firmed1.5 percent against the dollar on Wednesday after state-oilcompany NNPC sold around $200 million, coupled with a centralbank intervention to boost interbank forex market liquidity,dealers said.
The naira closed at 179.90 in volatile trades, gaining someground after it eased to an intraday low of 184.65 naira beforethe dollar sales. The naira closed at 182.60 to the dollarprevious day.
The central bank has been struggling to keep the nairawithin a new target band of 160-176 against the dollar it setlast month after it devalued the currency by 8 percent, to halta decline to its foreign reserves.
But its foreign reserves fell to $35.95 billion by Dec. 8,down 19.3 percent from a year earlier as the bank stepped up itsdefence of the currency, latest figures from the bank's websiteshowed on Wednesday.
"As soon as the dollar liquidity dries out, we expect thenaira to depreciate again unless the central bank intensifiesintervention," one dealer said.
Oil companies also sold dollars in addition to NNPC andcentral bank. Total sold $16 million, Brass LNG $12million, while Shell sold an undisclosed amount,dealers said.
The NNPC accounts for the bulk of dollars traded on theinterbank market as the state-oil company buys naira monthly inexchange for proceeds from the country's oil receipts to helpfund the government in Africa's biggest economy.
Dealers said it would take up to two days for lenders todeliver naira to the NNPC, giving some relief to overnightlending rates, which have been under pressure with the centralbank squeezing liquidity to support the currency.
Nigeria's overnight lending rate fell to 20 percent onWednesday, from 50 percent the previous day, as dealers cuttheir borrowing exposure on the interbank market in anticipationof a treasury bill payout.
Dealers expect a 150 billion naira ($834 million) treasurybill maturity on Thursday. Overnight lending rates spiked to arecord high of 70 percent on Monday.
The naira has fallen 11.8 percent against the dollar thisyear, including the one-off devaluation, as oil prices plunged. (Reporting by Oludare Mayowa and Chijioke Ohuocha; Editing byMark Heinrich)
