Money supply climbs to N119tn in October

Nigeria’s broad money supply rose to N119.04tn in October 2025 from N117.78tn in September, according to new data published by the Central Bank of Nigeria. The increase amounted to N1.25tn, equivalent to 1.06 per cent, reversing the slowdown recorded a month earlier.

Year-on-year, M3 (broad money supply) expanded by N11.04tn or 10.22 per cent from N107.99tn in October 2024, reflecting a continued build-up of liquidity in the financial system despite a tight monetary environment.

The rise in October followed the Monetary Policy Committee’s decision in September 2025 to cut the Monetary Policy Rate by 50 basis points to 27 per cent, the first rate reduction since 2020. The cut came as inflation began to moderate and foreign exchange conditions improved.

Broad money supply, which includes narrow money, quasi-money, and other liquid assets, strengthened in the month that followed, indicating a higher availability of cash and near-cash balances, even as the CBN cautiously eased without fuelling renewed inflationary pressure.

A significant driver of the increase was a jump in net domestic assets. NDA rose to N84.23tn in October from N76.12tn in September, a difference of N8.11tn or 10.65 per cent within one month. The rise reflects a surge in domestic credit conditions, including higher government borrowing and increased banking system claims on the private sector.

This sharp expansion outweighed a notable drop in net foreign assets, which declined from N41.66tn in September to N34.80tn in October. The fall of N6.86tn represents a 16.45 per cent month-on-month contraction, and highlights renewed external pressures, despite NFA still standing N14.01tn higher than the same period in 2024.

Money supply measured as M2 also grew modestly from N117.77tn in September to N119.03tn in October, an increase of N1.25tn or 1.06 per cent.

Compared with October 2024, M2 rose by N11.04tn or 10.22 per cent. M2 includes narrow money and quasi-money, such as savings and term deposits, and reflects the financial balances most commonly used for day-to-day transactions and short-term decisions.

Narrow money, or M1, showed a smaller change, growing from N39.11tn in September to N39.35tn in October, an increase of N239bn or 0.61 per cent. Year-on-year, M1 rose by N4.56tn or 13.12 per cent.