New Telegraph

December 8, 2023

Naira: ‘Banks must exchange N86bn daily to meet N3.2trn target

Renowned economist and Chief Executive Officer, Financial Derivatives Company Limited (FDC), Mr. Bismarck Rewane, has disclosed that the proposed naira redesign by the Central Bank of Nigeria (CBN) will see banks exchanging about N86 billion daily between December 15, 2022 and January 31, 2023.

This, he said, would enable them meet the targeted N3.2 trillion in circulation. Rewane made this known in his Lagos Business School (LBS) November Lecture titled: “The New Global Disorder Extra-Ordinary Times & Underwhelm-ing Leaders” in Lagos.

He explained that the new note policy won’t reduce inflation rate in the country, but would rather accentuate it because cash is only six per cent of money supply, and money supply growth average over the last five years is 12.5 per cent. This, to him, is likely to dash the hope and expectations of the apex bank and its promoters on the redesigning as the last resort to bounce back the country’s currency against the dollar at the foreign exchange market.

According to him, the CBN’s decision to schedule the currency change on January 31 in the first quarter of 2023, with general elections taking place in February and census in April, will aggravate disruption and unintended consequences in the country’s economy. He, however, suggested that the best option for the government was to postpone the planned redesigning or currency change policy and National Census in Q1’23 and focus on general elections.

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