President Muhammadu Buhari has Nigerians with illicit money stashed in the soil would have problems with the decision of the Central Bank of Nigeria, CBN, to launch new designs on the naira denominations.
Buhari also confirmed that he approved the plan.
He, however, assured that Nigerians would gain a lot when the redesigned new notes are launched.
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Recall that the CBN Governor, Godwin Emefiele had announced the launch of the redesigned naira notes on Friday.
Emefiele said the new notes would be launched on December 15, 2022.
Emefiele said the new currencies to be launched are N1,000, N500 and N200 notes.
However, the president said Nigeria with legitimate businesses would have no problem with the latest measure.
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In a series of tweets, Buhari wrote: “President @MBuhari today said that the decision of the Central Bank of Nigeria
@cenbank to launch new designs and replace high value Naira notes had his support. And he is convinced that the nation will gain a lot by doing so.
“People with illicit money buried under the soil will have a challenge with this. But workers and businesses with legitimate incomes will face no difficulties at all.”
Buhari’s comment is contrary to remarks by the Minister of Finance, Budget, and National Planning, Zainab Ahmed on the CBN’s policy.
Ahmed had distanced herself from the planned naira redesign, stressing that the policy did not receive the blessing of her ministry.
She warned of the dire consequences.
Factors Influencing Foreign Exchange Rates
Here are some of the causes of the dwindling dollar to naira exchange rate.
Inflation Rates: It is well known that inflation directly impacts black market exchange rates. If the Nigerian economy can be stabilized and inflation is controlled, the naira will benefit; however, if the naira continues to fall, it may indicate that food and other necessities are becoming more expensive daily.
Interest Rates: Another tool to keep an eye on is interest rates. If the interest rate at which banks lend money rises, it would harm the economy, causing it to contract and, as a result, the value of the naira to fall.
Government Debt: National debt can impact investor confidence and, as a result, the influx of funds into the economy. If inflows are high, the naira exchange rate will rise in favour of the naira.
Speculators: Speculators frequently impact the naira-to-dollar exchange rate. They stockpile money in anticipation of a gain, causing the naira to plummet even lower.
Conditions of Trade: Favorable trade terms will increase the value of the naira to the dollar, although Nigeria is currently experiencing a trade deficit. Everything comes from China, India, and the majority of Asian countries.
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