Dollar deposit by Nigerians in banks has exceeded the 30 per cent threshold approved by International Monetary Fund (IMF), a Central Bank of Nigeria (CBN) report has said.
The report by CBN economists said Nigerians have been accumulating foreign currencies to protect their wealth from naira volatility and surging inflation.
“Higher real-exchange rate volatility is associated with an increased level of currency substitution,” they said in the report.
According to them, there is a need to contain exchange rate volatility and inflation as a way of curbing the spate of currency substitution in the country.
The CBN economists, including Isaiah Ajibola, Sylvanus Udoette, Rabia Muhammad and John Anigwe, said Nigerians deposit in dollars hit peak of 98.2 per cent in 2015 before declining to 83 per cent in 2018.