LAGOS Oct 31 (Reuters) – Nigeria’s foreign currency reserves fell 20.5 percent year-on-year to $23.95 billion by Oct. 27, down 2.7 percent month-on-month, central bank data showed on Monday.

The central bank has been selling dollars to support the weakening naira, hit by low oil prices that have triggered the first recession for 25 years.

The central bank will sell $500 million currency forwards at an auction to clear demand backlog from manufacturers, traders said on Monday, as the regulator tries to find ways to resolve a chronic dollar shortage plaguing the West African nation. (Reporting by Oludare Mayowa; Editing by Chijioke Ohuocha and Louise Ireland)