Nigeria’s Money Supply (M²) dropped by 1.58 per cent month-on-month (MoM) to N117.8 trillion in September 2025, from N119.7 trillion in August 2025, driven by a five per cent decline in banks’ credit to the economy.
The Central Bank of Nigeria’s (CBN), disclosed this yesterday in its Money and Credit Statistics Data, for September 2025 which indicated that the various components of the money supply recorded decline during the period except Currency Outside Banks. CoB.
Quasi Money decreased by 1.99 per cent MoM to N78.7 trillion in September from N80.3 trillion in August.
Narrow Money (M¹), also declined by 0.76 per cent MoM to N39.1 trillion in September from N39.4 trillion in August.
Likewise, Demand Deposits fell by 0.86 per cent MoM to N34.6 trillion in September from N34.9 trillion in August.
But Currency Outside Banks (COB) rose slightly by 0.45 per cent MoM to N4.47 trillion in September from N4.45 trillion in August.
The decline in money supply is driven by a 2.1 per cent MoM decline in credit to the economy to N96.7 trillion in September from N98.8 trillion in August.
This follows a 4.4 per cent MoMin decline in banks’ credit to the private sector which fell to N72.5 trillion in September from N75.9 trillion in August.
The decline subdued the impact of a 5.67 per cent increase in credit to the government to N24.2 trillion in September from N22.9 trillion in August.
The decline in credit to the economy and Money Supply reflects the impact of the CBN’s aggressive monetary tightening stance aimed at reining in inflation, which has remained in double digits despite several rounds of interest rate hikes. The apex bank has raised the Monetary Policy Rate (MPR) by more than 800 basis points since mid-2023, tightening liquidity across the banking sector.
