The freshly redesigned N200, N500, and N1,000 Naira notes will enter circulation today, the Governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, said yesterday at the conclusion of the Monetary Policy Committee (MPC) meeting in Abuja.
According to him, President Muhammadu Buhari would reveal the new Naira banknotes at 10 a.m. in the Council Chambers at a meeting of the Federal Executive Council (FEC).
Emefiele did not provide a justification for moving forward the debut of the new Naira banknotes from December 15, 2022 to December 15, 2021. However, he said that the date of January 31, 2023 when the existing notes would cease to be legal currency remains constant.
Emefiele, speaking on the impact of the circulation of high-denomination currency on the economy, said that the predominance of high-denomination currency in transactions may contribute to inflation in the nation.
The governor of the Central Bank of Nigeria (CBN) said that bigger denomination banknotes would continue to be created, but their circulation will decrease over time. This, he said, is intended to stimulate the usage of lesser value currency and inevitably reduce inflation.
Emefiele complimented President Buhari for consistently protecting the central bank, noting that “President Buhari has stepped out twice to defend the CBN” when the bank was attacked for the choices it made. Among these choices was the redesign of Naira banknotes.
In addition, he commended the Senate for its support and “the security agencies, especially the Economic and Financial Crimes Commission (EFCC), for ensuring the program’s seamless transfer.”
On being asked whether the CBN would consider extending the deadline for the deposit of old notes by Nigerians in diaspora, the CBN governor denies the notion, stating, “We will not wait for Nigerians in diaspora to send in old notes since they do not spend Naira. There will be no extension of the deadline, and what we have done is not illegal.”
Additionally, for the third time in a row this year, Emefiele announced an increase in interest rates to 16.5% while maintaining other conditions.
According to him, the rationale for the increase in interest rates is that the earlier choices of the CBN to combat inflation by raising interest rates have begun to have beneficial outcomes, with the gap between inflation data heading lower.
According to him, “we find it reassuring that the rate of increase in inflation in Nigeria is moderating gradually; between June and July, the month-on-month inflation rate was 1.82 percent; between July and August, it was 1.7 percent; between August and September, it was 1.3 percent; and between September and October, it was 1.2 percent.”