Currency Outside Banks Drops by 3.32% – CBN

Currency held outside of Nigeria’s banking system dropped to N3.66tn in July, about 3.32 per cent lower than it was in the previous month.

This was disclosed in Money and Credit data available on the website of the Central Bank of Nigeria (CBN).

This showed that the amount outside banks dropped to 90.39 per cent from 93.59 per cent of the currency in circulation recorded in June 2024.

The value of currency in circulation rose in July to N4.05tn from N4.04tn.

From the beginning of the year, the amount of money in circulation rose by 11.05 per cent compared to 56.17 per cent rise in the same period in 2023.

Members of the Monetary Policy Committee of the Central Bank of Nigeria have blamed the excess cash in circulation for the accelerating inflation in the country.

Also, money supply (M3), which is a broad measure of the total amount of money in an economy, hit a high of N106.27tn in July 2024, amid tightening measures by the CBN.

The apex bank has maintained a hawkish stance in a bid to rein in inflation.

At its last Monetary Policy Committee (MPC) meeting in July 2024, the CBN raised the MPR by 50 basis points to 26.75 percent from 26.25 in June 2024.

Meanwhile, credit to the private sector continued its upswing to N75.48tn year-on-year in July 2024. On a month-on-month basis, banks’ credit to the private sector increased by 3.13 per cent from N73.19tn in June 2024.