Latest data from the Central Bank of Nigeria (CBN) has revealed that Nigeria’s broad money supply (M3) fell slightly to N123.15 trillion in February 2026, representing a minor decrease from the N123.36 trillion recorded in January 2026.
Despite this monthly dip, the total liquidity in the economy remains significantly higher than the N110.71 trillion reported in February 2025, underscoring a robust year-on-year expansion in the nation’s financial system.
The components of this monetary data reveal a strategic rebalancing of liquidity sources within the Nigerian economy.
Narrow money (M2), which excludes foreign currency deposits, mirrored the broader trend by falling to N123.14 trillion, signaling a modest tightening of liquid funds available for short-term economic activities.
Simultaneously, net foreign assets (NFA) saw a decline to N28.41 trillion, while net domestic assets (NDA) rose to N94.74 trillion, driven primarily by increased domestic credit and heightened financial sector activity.
This marginal contraction in money supply arrives as monetary authorities intensify efforts to stabilize prices and manage the naira against persistent external pressures.
The CBN has maintained a cautious yet proactive stance, with the Monetary Policy Committee (MPC) recently reducing the Monetary Policy Rate (MPR) by 50 basis points to 26.5% during its February meeting.
This adjustment followed a previous reduction in September 2025 and reflects the apex bank’s attempt to stimulate economic growth while maintaining a vigilant watch over inflationary trends.
Complementing these monetary shifts, the National Bureau of Statistics (NBS) reported a slight cooling in inflation, with the headline rate declining to 15.06% in February 2026.
While the dip in M3 suggests short-term liquidity constraints, analysts suggest it does not indicate an economic contraction but rather a delicate balancing act by policymakers.