Since the CBN’s announcement last week to redesign Naira notes, the Naira has continued to have a free fall from its initial record low of N765/$1, losing over N53 in five days, further piling pressure on the local currency.
The Naira fell to N818/$1 at the parallel market on Monday in Abuja and N815 in Lagos as it continued to lose its value.
Bureau De Change, BDC, operators confirmed that there was an increase in demand following the CBN’s announcement that it will introduce new notes.
It could not be confirmed if the scarcity is as a result of operators hoarding the dollars to create more scarcity and make more profit.
An economist and Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr Muda Yusuf, said, ‘The recent depreciation of the naira was fuelled by those who had huge cash in local currency that they wanted to hide away as a result of the redesign of currency notes by CBN and those who wanted to move their wealth away from Naira to a more stable currency.”
“The rise is a result of the announcement by the CBN to redesign currency notes and the fact that we have people who have huge cash who might not be comfortable taking them to the bank because EFCC will be watching. However, all the current policies of the government, especially by the CBN have been affecting confidence in the Naira.
“Naira has been failing in one of its major functions as money, which is serving as a store of value because when a currency continues to depreciate in value as a result of inflation, the tendency is that people will move to a more stable currency,”