Cash Outside Banks Falls ₦198bn in January

Cash held outside Nigeria’s banking system fell by ₦197.68bn in January 2026, dropping to ₦5.21tn, according to the Central Bank of Nigeria’s Money and Credit Statistics.

The decline came as total currency in circulation slipped marginally to ₦5.73tn, though the share of cash outside banks remained high at 90.91%, slightly lower than 94.33% in December 2025.

Year-on-year, cash outside banks was still higher, rising from ₦4.74tn in January 2025 to ₦5.21tn in January 2026, while overall currency in circulation expanded by ₦495.68bn.

Broad money supply (M3) fell by ₦1.05tn to ₦123.36tn in January, driven largely by a decline in net foreign assets, which dropped to ₦29.61tn from ₦31.51tn in December.

The naira strengthened during the month, closing at ₦1,391/$ compared with ₦1,431/$ at the start of January, contributing to the lower naira value of foreign assets.

Meanwhile, net domestic assets rose to ₦93.76tn, up ₦850.76bn month-on-month, reflecting stronger domestic credit and liquidity conditions. Narrow money also increased to ₦42.33tn, showing a year-on-year rise of ₦5.57tn.

Against this backdrop, the Monetary Policy Committee (MPC) cut the benchmark interest rate by 50 basis points to 26.5%, citing easing inflation and improved FX stability. Governor Olayemi Cardoso said food inflation fell to 8.89%, the lowest in 13 years.

Cardoso reaffirmed the MPC’s commitment to evidence-based policy, noting that “the ongoing disinflation trajectory would continue, largely supported by sustained exchange rate stability and enhanced food supply.”