Nigerian Households, Businesses Hold More Money to Spend as Cash in Circulation Rises to N133tn
- Nigeria's broad money supply increased, showing that liquidity in the economy continued to grow despite the CBN's tight monetary policy
- The increase was mainly driven by higher domestic assets, savings, and time deposits, while cash held outside the banking system declined
- The growth in money supply comes after the CBN retained the MPR, although analysts warn that rising liquidity could make it harder to control inflation
Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
Nigeria’s broad money supply increased to N133.25 trillion in June 2026, rising from N129.21 trillion in May, even as the Central Bank of Nigeria (CBN) maintained its benchmark Monetary Policy Rate (MPR) at 26.5%.
Fresh data released by the apex bank on Wednesday, July 22, 2026, showed that the country’s money supply grew by N4.04 trillion month-on-month, indicating that liquidity in the economy continued to expand despite the CBN’s aggressive monetary tightening aimed at slowing inflation.
Source: UGC
The latest figures suggest that households and businesses had more funds available for spending and investment in June than in the previous month, highlighting the challenge facing the CBN as it seeks to balance economic growth with price stability.
Domestic assets and deposits drive liquidity growth
Broad money, which measures the total amount of money circulating within the economy, includes cash, demand deposits, savings, time deposits and other highly liquid financial assets.
According to the CBN data, the increase in liquidity was largely driven by stronger domestic assets and growth in quasi-money.
Quasi-money, which comprises savings and fixed-term deposits, climbed to N88.54 trillion in June from N84.58 trillion in May. Demand deposits also recorded a modest increase, rising to N39.78 trillion from N39.43 trillion.
At the same time, cash held outside the banking system declined to N4.92 trillion, compared with N5.19 trillion in the previous month. This suggests more cash remained within the formal banking sector during the period.
Further analysis showed that net domestic assets rose by 4.37%, increasing from N102.26 trillion in May to N106.73 trillion in June.
However, net foreign assets moved in the opposite direction, falling by 1.56% from N26.95 trillion to N26.53 trillion over the same period.
Overall, the country's broad money supply expanded by 3.11% month-on-month, underscoring continued growth in liquidity despite tighter monetary conditions.
Inflation concerns persist as CBN holds rates
The latest increase in money supply comes as the CBN continues its efforts to contain inflation while maintaining macroeconomic stability through a restrictive monetary policy.
Economists have cautioned that sustained growth in liquidity could complicate the apex bank’s fight against inflation by increasing the amount of money available for spending across the economy.
The figures were released shortly after the CBN’s Monetary Policy Committee concluded its latest meeting, where members voted to retain the Monetary Policy Rate at 26.5%.
The committee also left all other key monetary policy parameters unchanged, maintaining that the current tight policy stance remains necessary to support the ongoing disinflation process and preserve overall macroeconomic stability.
CBN unveils tough new rules for Fintechs, others
Meanwhile, Legit.ng earlier reported that the CBN rolled out sweeping new regulations for major fintech firms between March and June 2026.
CBN introduced ring-fencing rules requiring each fintech subsidiary to operate with its own governance, capital, and risk systems.
Fintechs that control more than 25% of consumer issuing will face strict limits on their share of merchant acquiring under the new rules.
Source: Legit.ng
