WHAT IS AN NGN
NGN is the abbreviation for the Nigerian Naira.
BREAKING DOWN NGN
NGN is the abbreviation for the currency of Nigeria, which is known as the Nigerian Naira.
From 1912 to 1959, the West African Currency Board issued Nigerian currency, and prior to that, Nigeria had used various forms of money including cowries and manilas.
On July 1,1959 the Central Bank of Nigeria began issuing Nigerian currency notes and coins, and the West African Currency Board notes and coins were withdrawn. However, the legal status did not change to reflect this until two years later in July 1962. The notes were again changed in 1968 as a war strategy following the misuse of the country’s currency notes.
The Central Bank of Nigeria (CBN) is the sole issuer of money throughout the Nigerian Federation. The CBN controls the volume of money supplied in the Nigerian economy to ensure monetary and price stability. Notes and coins are printed by the Nigerian Security Printing and Minting Plc (NSPM) and issued by the Central Bank of Nigeria. The Currency and Branch Operations Department of the CBN oversees currency management through the procurement, distribution, supply, processing, reissue and disposal of bank notes and coins. The CBN maintains an inspection office to ensure that every note issued meets the required standards. Currency is issued to deposit money banks through the branches of the CBN.
The International Currency Market
The NGN is part of the currency market, also known as the Foreign Exchange market, which is the largest financial market in the world with an average daily trading volume of $6.6 trillion. The International Currency Market is a market in which participants from around the world buy and sell different currencies. Participants include banks, corporations, investment management firms, hedge funds, retail forex brokers and investors.
The currency market’s primary purpose is to facilitate the exchange of currency that is necessary for foreign trade. When an entity in one country sells something to an entity in another country, the seller earns foreign currency. For example, when China sells t-shirts to Walmart, China earns U.S. dollars. When Toyota wants to build a factory in the U.S., it needs dollars. The company in need of foreign dollars may get those from its local bank, which in turn will obtain them from the international currency market. This market exists to facilitate these types of exchanges. The currency market also has unique characteristics that make it an attractive market for investors who want to optimize their profits.