Monetary statistics accessed from the Central Bank of Nigeria (CBN) has shown within the period of the nation’s exit from recession, currency in circulation dropped to an all time low of N1.77 trillion from N22.54 trillion year-on-year (YOY) when compared to last year.
Currency in circulation in public finance and development economics means the total value of currency that has ever been issued minus the amount that has been removed from the economy by the central bank.
According to financial analysts, even though drop in currency in circulation helps in controlling inflation, government needs to raise spending to boost liquidity so as to grow empowerment of Nigerians.
It would be recalled that the federal government had said two months ago that it has released about N350bn to push up government spending in order to inflate the economy.
However, pundits are upbeat that one of the first things the government should do now is to pump in more money by way of paying contractors and other heavy spending so as to rejig the flow of currency which will in turn push up liquidity to deepen the economy’s exit form recession and un-productivity.
Data from the apex bank showed that the currency in circulation as at April, May and June (the second quarter) when the recession ended, declined from N1.976 trillion to N1.898 trillion and N1.874 trillion in that order; down from N20.728 trillion, N20.722 trillion and N22.078 trillion recorded the same period last year.
During the first month of third quarter (July), which can be seen as first post-recession month, currency in circulation stood at N1.77 trillion as against N22.535 trillion recorded same period in 2016.
Currency in circulation during the first quarter of this presented a descending order as while January had N1.995 trillion, February ended with N1.979trillion, leaving March trailing at N1.984 trillion as against N19.800 trillion, N20.621trillion and N20.470 trillion respectively in 2016.