Currency in circulation within Nigeria’s banking industry soared to $5.24 trillion in January 2025, marking the highest level recorded by the Central Bank of Nigeria (CBN).
This significant increase represents the $3.65 trillion reported in January 2024 increase of 1.22 trillion.
Analysts attribute CBN’s continued printing of local currencies and the country’s escalating inflation rate to local currencies.
The surge also reflects public distrust of the banking system, with many Nigerians choosing cash transactions amid economic uncertainty.
When Governor of CBN Mutual codoso He took office in September 2023, with circulating currency of 2.76 trillion yuan.
Despite the increased currency cycle, Nigeria’s economic growth remains slow, with growth rates expected to be between 2.9% and 3.1% in 2024, the slowest in West Africa.
In response to inflationary pressure, CBN’s Monetary Policy Committee (MPC) Improved Monetary Policy Rate (MPR) A record 27.25%, indicating a strong monetary tightening stance aimed at stabilizing the economy.
Analysts believe that the rise in the currency cycle shows that government spending has increased mitigation of economic difficulties, which has exacerbated inflation.
Vice President, HighCap Securities Limited, David Adnorinoting that increasing government spending will inject more money into the economy, resulting in an economic trade-off between money supply and price stability leading to higher inflation.
