The Central Bank of Nigeria (CBN) has disclosed that the Nigeria’s Naira notes currently in circulation, reached a record high ₦3.97 trillion at the end of May.
The record marks a 1.07% increase compared to April, which figures increased to ₦3.92 trillion from ₦3.86 trillion in March, according to data released by the Central Bank of Nigeria.
Despite the tightening of the CBN’s monetary policy, which includes a benchmark interest rate of 26.65%, the currency in circulation has continued to grow month-on-month.
The currency in circulation refers to Naira notes and coins that have been produced and issued for use in the economy.
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The apex bank reported that in March this year, the currency in circulation at ₦3.87 trillion represented a 4.76% increase from ₦3.69 trillion in February 2024.
Additionally, the amount of currency held outside of banks also increased during the first quarter, rising from ₦3.28 trillion in January to ₦3.41 trillion and ₦3.63 trillion in February and March, respectively.
This data indicates that over 90% of the currency in circulation is held outside of the banking system, suggesting that Nigerians are holding more cash.
During the March meeting of the Monetary Policy Committee, Muhammad Abdullahi, one of the committee members, highlighted the high amount of currency held outside of banks as one of the factors contributing to the country’s inflation.
Naija News
