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Mixed Reactions Trails CBN’s Move on New Naira Note

The Central Bank of Nigeria’s (CBN) move to redesign and reissue the N200, N500, and N1000 notes have been welcomed with diverse reactions by the citizens of Nigeria.

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NAIRA - Investors King

The Central Bank of Nigeria’s (CBN) move to redesign and reissue the N200, N500, and N1000 notes have been welcomed with diverse reactions by the citizens of Nigeria.

This move by the apex bank has caused quite a controversy between analysts, experts, and stakeholders as some individuals think it is commendable and a few others believe that this is happening at the wrong time.

Amongst those that welcomed the idea was the Secretary General of the Conference of Nigeria Political Parties (CNPP), Chief Willy Ezugwu, he commended the actions of the CBN, saying only politicians who have plans to buy votes and ill-motivated individuals would hate CBN’s action.

Similarly, the former President of Governing Council of the Association of Corporate Treasures of Nigeria (ACTN), Mr. Zeal Akaraiwe said that the decision of the CBN was the answer needed to wade in huge amounts of cash into the banking system while enhancing the effectiveness of CBN’s Monetary policies.

The Executive Chairman of the Economic and Financial Crimes Commission (EFCC), Abdulrasheed Bawa, described the plan by CBN to redesign some of the Naira notes as a welcome development.

However, among the few others who criticized the move was Economic expert, Emeka Okengu, who argued that the timing was wrong.

With respect to the CBN’s claim of curbing currency counterfeiting as one of its reason, Okengu said counterfeiting doesn’t stop by just changing the currency; it can only be addressed by tracking and arresting those involved.

Similarly, security expert, Senator Iroegbu, questioning the decision said, from afar, the reason for the change seems genuine but a deeper look makes the whole decision unbelievable and staged, adding that this would only affect the poor masses.

Also, a political economist, Mr. Adakole Ijogi disclosed that the timing of the apex bank was wrong as it would disrupt the economy, and would put unnecessary pressure on businesses as well as affect the forthcoming 2023 general election.

In addition, the Executive Director of the Civil Society Legislative Advocacy Centre (CSLAC), Auwal Musa said that the plan to redesign the Naira notes is not deemed an economic priority considering the present economic situation the country is facing, adding that, the CBN ought to channel that energy into reviving the economy.

He said “Firstly, the CBN’s decision to redesign and reissue new 200, 500, and 1000 notes is not an economic priority and barely a solution to addressing Nigeria’s poor monetary policy challenges and growing economic woes.

“Especially at a time when the country is grappling with huge fiscal deficits, a free fall of the naira, soaring inflation rates, multiple forex rates, and rising borrowing costs. The reasons for this decision seem no different from those given for the forex demand management strategy which resulted in a non-satisfactory conclusion as the artificially low exchange rate failed to be as reflective of the market as possible to improve supply, but this time it only threatens damning economic consequences for Nigerians.”

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Naira

Nigeria Hits Historic High as Currency in Circulation Surges to N3.69 Trillion

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Nigeria’s currency in circulation surged to a historic high of N3.69 trillion, according to data released by the Central Bank of Nigeria (CBN).

This figure represents an increase of N43.07 billion or 1.18 percent from the total of N3.65 trillion reported in January 2024 and a 13.64 percent year-on-year rise from N3.25 trillion reported in February 2023.

Currency in circulation encompasses the physical cash, including paper notes and coins, actively used in transactions between consumers and businesses within the country.

The latest statistics indicate a considerable uptick in the availability of cash within the Nigerian economy.

The surge in currency supply comes amidst lingering concerns over a potential cash crunch following the monetary policy adjustments by the CBN, particularly the aggressive tightening stance of the Monetary Policy Committee (MPC).

Analysts attribute this spike to various factors, including the fear factor stemming from the cash crunch experienced in 2023 and lingering uncertainties surrounding the administration of physical currency.

Despite the surge in currency in circulation, Nigeria’s economic growth remains sluggish, with projections indicating growth rates of around 2.9 percent to 3.1 percent for 2024.

Also, inflation remains a significant concern, with the headline inflation rate climbing to 31.70 percent in February 2024 from 29.9 percent reported in January 2024, according to data from the National Bureau of Statistics (NBS).

The CBN’s proactive approach to monetary policy, including a historic increase in the monetary policy rate (MPR) to 24.75 percent, underscores the central bank’s commitment to addressing economic challenges and fostering stability amidst persistent pressures.

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Nigerian Naira Surges to N1,350 per Dollar in Parallel Market

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New Naira notes

The Nigerian Naira has appreciated to N1,350 per dollar in the parallel market, a significant gain from its previous rate of N1,430 per dollar just a day earlier.

Similarly, in the Nigerian Foreign Exchange Market (NAFEM), the naira strengthened to N1,382.95 per dollar, indicating an upward trend across key forex segments.

Data from FMDQ revealed that the indicative exchange rate for NAFEM fell to N1,382.95 per dollar from N1,408.04 per dollar on the previous day, representing a gain of N25.09 for the naira.

This surge in the naira’s value has widened the margin between the parallel market rate and NAFEM to N32.95 per dollar from N21.96 per dollar previously.

Analysts attribute this impressive surge to recent foreign exchange reforms implemented by the Central Bank of Nigeria (CBN).

These reforms, including the consolidation of exchange rate windows and liberalization of the FX market, have contributed to bolstering the naira’s strength against the dollar.

The CBN’s proactive measures aim to promote stability, transparency, and liquidity in the foreign exchange market, fostering confidence among investors and strengthening the national currency.

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Dollar to Naira Black Market Today, March 26th, 2024

As of March 26th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,430 NGN in the black market, also referred to as the parallel market or Aboki fx.

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New Naira notes

As of March 26th, 2024, the exchange rate for the US dollar to the Nigerian Naira stands at 1 USD to 1,430 NGN in the black market, also referred to as the parallel market or Aboki fx.

For those engaging in currency transactions in the Lagos Parallel Market (Black Market), buyers purchase a dollar for N1,450 and sell it at N1,440 on Monday, March 25th, 2024 based on information from Bureau De Change (BDC).

Meaning, the Naira exchange rate improved slightly when compared to today’s rate below.

This black market rate signifies the value at which individuals can trade their dollars for Naira outside the official or regulated exchange channels.

Investors and participants closely monitor these parallel market rates for a more immediate reflection of currency dynamics.

How Much is Dollar to Naira Today in the Black Market?

Kindly be aware that the Central Bank of Nigeria (CBN) does not acknowledge the existence of the parallel market, commonly referred to as the black market.

The CBN has advised individuals seeking to participate in Forex transactions to utilize official banking channels.

Black Market Dollar to Naira Exchange Rate

  • Buying Rate: N1,430
  • Selling Rate: N1,420

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