Money supply surges to N99.23trn, currency outside banks hits N3.70trn
By Opeyemi Abdulsalam
Nigeria’s money supply has reached a record high, according to recent data from the Central Bank of Nigeria (CBN).
The total amount of money in circulation, known as M3, stood at N99.23 trillion in May 2024.
Despite efforts by the CBN to reduce the amount of money in circulation, the amount of currency outside of banks increased to N3.70 trillion.
This suggests that the monetary tightening measures put in place by the CBN have not yet had the desired effect.
The data shows that M3 increased by 2.33 percent compared to the previous month, rising from N96.97 trillion in April 2024.
This represents a significant increase of 7.46 percent compared to the previous quarter, when M3 stood at N92.34 trillion in March 2024.
The increase in money supply could have implications for inflation and economic growth in Nigeria.
As more money circulates in the economy, it can lead to higher demand for goods and services, potentially driving up prices.
The CBN’s efforts to manage money supply and inflation will be closely watched in the coming months.
The bank’s actions will have a significant impact on the overall direction of the Nigerian economy, and it remains to be seen whether the current monetary tightening measures will be effective in curbing inflationary pressures.
Similarly, the Central Bank data showed that credit to the private sector increased to N74.31 trillion in May 2024, representing a 1.92 percent rise above N72.91 trillion in April 2024.
The Currency outside banks rose to N3.70 trillion in May 2024. This represents a 2.77 percent increase compared to N3.60 trillion in April 2024.
The development comes despite CBN’s interest hike to 26.25 percent in May 2024 from 18.75 percent in January.
On Sunday, the Socio-Economic Rights and Accountability Project, SERAP gave CBN an ultimatum to account for the whereabouts of the over N100 billion ‘dirty and bad notes’ and ‘other large sum of cash awaiting extermination’.
