Data by the Central Bank of Nigeria (CBN), on Tuesday showed that currency-in-circulation and outside of the banking system was flat, rising by a marginal N10.148bn or 0.56% to N1.791tr at the end of October (Month-on-Month), compared to N1.781tr in the corresponding period of September.
According to www.investopedia.com, “currency in circulation is currency that is physically used to conduct transactions between consumers and businesses rather than stored in a bank, financial institution or central bank.”
Wikipedia, https://en.wikipedia.org, on the other hand, defines it as term in monetary economics as “…the total value of currency (coins and paper currency) that has ever been issued minus the amount that has been removed from the economy by the central bank.”
On a year-on-year basis, the currency-in-circulation in Nigeria, according to the CBN data, declined in October by N34.47bn, or 1.88% from N1.825tr in the preceding 10th month; year-to-date, currency in circulation in Nigeria was down by N387.98bn or 17.8% from the N2.179tr recorded in December 2016.
The biggest drop so far was between December 2016 and January 2017, when the figure declined by N184.597bn or 8.47% to N1.978tr; while the lowest it has fallen so far this year was the N1.769tr reported for the July month-end.
Investdata Research findings show that currency-in-circulation has always risen within the last months of the year begin in October and through the festive months of November and December.
Based on this and except there is a shift occasioned by some form of pressure, it is expected that the Nigerian economy would be awash with Naira, a chunk of it derived from changing US$ and Euro mainly sent to relatives in the country from abroad whether to celebrate the festivities or handle one project or another.
In 2016, for example, currency-in-circulation grew from N1.825tr in October; first to N1.907tr and then N2.179tr, the peak so far. In 2015, the figure rose from N1.56tr in October; first to N1.633tr; and then N1.857tr; while the previous year’s figure rose to N1.797tr in December; from N1.578tr and N1.534tr in the two preceding months.