Across major markets, prices of goods are moving away from the lower denomination of the Naira currencies as inflation bites harder.
Not too long ago, a sachet of pure water cost N5, while N20 gained popularity as the denomination used to “settle” police officers at checkpoints.
However, in the past couple of years, these notes have struggled to get items they could be attached to.
A market survey by Journalist showed that more than half of Nigeria’s legal tenders cannot make purchases.
Despite this, the Central Bank of Nigeria, CBN, recognizes the following denominations; 50 kobo, N1 and N2 which are coins, and N5, N10, N20 and N50 which are printed on polymer materials.
A sachet of pure water now sells for N30. Retailed sugar no longer sells for N10, while candies like Tom Tom are retailed at two pieces for N50. To further compound the woes of these notes, goods are now rounded up to 50 or 100, which further makes these currencies irrelevant.
In the past six months, the Naira has depreciated considerably. At one point, it was about N1,900 to a single dollar until the intervention by the CBN with the naira now trading at about N1050 to a dollar.
The implication of it is that N1000, which is Nigeria’s highest denomination, is less than a single dollar.
Anyone with $1000 is a millionaire in naira based on the current exchange rate, and anyone with $1 has more than N1,000.
Despite the recent surge in the value of naira, prices of commodities have not shown any significant signs of climbing down.
Experts believe that Nigeria’s inflation is a product of many factors, with FX being one of the numerous factors.
But despite this, the Nigerian government is still printing some of the lower denomination currencies at a huge cost.