Central Bank: Money Supply Increased to N66.42trn in September

Nume Ekeghe

The Central Bank of Nigeria (CBN) has disclosed that Nigeria’s money supply increased to N66.42 trillion in the month of September 2023, a marginal growth of about 1.94 per cent from N65.15 trillion in August 2023.

The figures come from the latest data released by the CBN as captured in its money and credit statistics.

The money supply, identified as M2, captures the total amount of money available in the economy at a particular moment and it has gained about 25.70 per cent or N13.58 trillion in nine months of 2023. 

In January 2023, the apex bank disclosed that the money supply stood at N52.84 trillion, moving high to N52.92 trillion in February 2023. It closed March 2023 at N54.19 trillion before crossing the N55 trillion mark in April 2023 to N55.65 trillion. It dropped by 0.18 per cent to N55.55 trillion in May. 

The M2 closed June and July 2023 at N64.36 trillion and N64.93 trillion, respectively.  

M2 includes physical currency such as coins and banknotes, in addition to various types of deposits maintained by individuals, enterprises, and institutions in banks and other financial entities.

The statistics revealed that certain components of the money supply, namely demand deposits, quasi-money, and currency outside banks, also witnessed growth and declines.

Specifically, quasi-money, which pertains to financial tools that can be easily converted to cash, surged from N40.9 trillion in August 2023 to N41.06 trillion in the month of September 2023.

Moreover, demand deposits, primarily made up of chequing accounts or funds in banks accessible without prior notice, increased to N23.01 trillion in September 2023 from N21.93 trillion reported in August 2023. 

Money supply is a crucial indicator when evaluating interest rates and potential inflation during a certain timeframe.

The statistics also revealed that credit to the private sector increased to N58.6 trillion in September 2023, becoming the highest so far.

The reported N58.6 trillion by CBN is 41.06 per cent and 44.64 per cent Year-till-Date (YTD) and Year-on-Year (YoY) (YoY) gain, respectively.

Credit to the private sector opened this year at N41.54 trillion in January 2023, gaining N17.07 trillion in nine months of 2023.

The statistics also disclosed that credit to the government dropped 1.10 per cent to N34.12 trillion in September 2023 from N34.5 trillion reported in August.