Following the Central Bank of Nigeria’s (CBN) new naira policy to manage currency in circulation in the country, the currency in circulation has dropped to N3.01 trillion in December 2022 from N3.30 trillion at the end of October 2022 after the introduction of the new naira note.
The CBN governor, Mr. Godwin Emefiele, announced on October 26, 2022, the central bank’s resolve to redesign, produce, and circulate new series of the N1,000, N500, and N200. Emefiele said the motive is to help reduce the currency in circulation, manage the money supply, and also tackle financial terrorism in the country.
The CBN defined “currency in circulation” as currency outside the vaults of the apex bank; that is, all legal tender currency in the hands of the general public and in the Deposit Money Banks’ (DMBs) vaults.
According to figures from the CBN, the currency in circulation has witnessed a massive decline since October 2022, when the new naira policy was introduced.
The CBN’s “Money and Credit” statistics revealed that currency in circulation in December 2022 stood at N3.01 trillion, down from N3.30 trillion in October 2022.
Findings by RateCaptain revealed that currency in circulation dropped by 9.52 percent in December, the highest decline in 2022.
At the end of the first quarter, the apex bank reported N3.35 trillion currency in circulation, dropping to N3.23 in the last month of the second quarter. A massive decline of N3.01 trillion was recorded in the last month of the third quarter due to the CBN’s new naira policy to regulate the currency in circulation across the country.
RateCaptain, an economist and research analyst, said that this move taken by the CBN is highly commendable since it not only reduces financial crime but also promotes economic stability by controlling the volatility associated with changes in the money supply, leading toward sustainable growth prospects for the Nigerian economy going forward into the future.
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