Key points
- Nigeria’s broad money supply (M3) increased to N133.25 trillion in June 2026 from N129.21 trillion in May.
- The increase came despite the Central Bank of Nigeria (CBN) maintaining the Monetary Policy Rate (MPR) at 26.5%.
- Money supply expanded by N4.04 trillion month-on-month and N16 trillion year-on-year.
- Growth was driven mainly by higher quasi-money and net domestic assets.
- Currency outside banks declined, while demand deposits and savings-related assets increased.
Main Story
Nigeria’s broad money supply (M3) rose to N133.25 trillion in June 2026, up from N129.21 trillion recorded in May, despite the Central Bank of Nigeria (CBN) maintaining its benchmark interest rate at 26.5% as part of efforts to tame inflation and preserve macroeconomic stability.
The latest figures, released in the CBN’s Money and Credit Statistics, show that broad money expanded by N4.04 trillion, representing a 3.11% month-on-month increase, while year-on-year growth stood at 13.59%, translating to an increase of about N16 trillion from N117.25 trillion recorded in June 2025.
Broad money (M3) comprises currency in circulation outside banks, demand deposits, savings deposits, time deposits and foreign currency deposits held within the banking system.
The data showed that the increase in liquidity was largely driven by growth in quasi-money, which rose to N88.54 trillion in June from N84.58 trillion in May.
Similarly, M2 money supply, which includes narrow money and quasi-money, increased to N133.24 trillion, compared with N129.20 trillion in the previous month.
Demand deposits also recorded modest growth, rising to N39.78 trillion from N39.43 trillion, while currency held outside the banking system declined to N4.92 trillion, down from N5.19 trillion in May.
Driving the Numbers
The expansion in money supply was underpinned by stronger domestic liquidity conditions, particularly growth in net domestic assets.
Net domestic assets increased by 4.37%, rising from N102.26 trillion in May to N106.73 trillion in June.
Net foreign assets declined marginally by 1.56%, falling to N26.53 trillion from N26.95 trillion.
Broad money (M3) rose by 3.11% month-on-month, adding N4.04 trillion.
On a year-on-year basis, money supply expanded by 13.59%, reflecting an increase of approximately N16 trillion.
Quasi-money grew by N3.96 trillion to N88.54 trillion, accounting for the bulk of the increase in overall liquidity.
Demand deposits increased by N350 billion to N39.78 trillion, while currency outside banks declined by about N270 billion.
The figures suggest that despite tight monetary policy, liquidity within the financial system continued to expand, driven largely by growth in savings, fixed deposits and other interest-bearing financial assets.
The Issues
The continued growth in money supply comes as the CBN maintains an aggressive monetary tightening stance aimed at moderating inflation.
Ordinarily, higher interest rates are expected to reduce liquidity by discouraging borrowing and slowing money creation. However, the latest data indicate that growth in domestic financial assets and deposit mobilisation continues to support expansion in the money supply.
Economists often monitor money supply closely because excessive liquidity can fuel inflation if not matched by growth in economic output. At the same time, stronger liquidity can support lending, investment and overall economic activity.
The latest figures therefore highlight the delicate balance the apex bank must maintain between containing inflation and ensuring adequate liquidity to support economic growth.
What’s Being Said
The Central Bank of Nigeria has maintained that its current monetary policy stance is intended to sustain the ongoing disinflation process while preserving macroeconomic stability.
At its 305th Monetary Policy Committee (MPC) meeting held on May 19 and 20, 2026, the Committee unanimously voted to retain the Monetary Policy Rate (MPR) at 26.5%, alongside other key policy parameters.
The MPC said maintaining the benchmark rate would help consolidate recent gains in price stability while supporting investor confidence and financial system stability.
What’s Next
Investors and analysts will closely monitor subsequent money supply data alongside inflation figures to assess the effectiveness of the CBN’s monetary tightening measures.
Attention will also focus on the outcome of future MPC meetings, where policymakers will evaluate whether current liquidity conditions warrant further policy adjustments or a continuation of the existing stance.
Bottom Line
Nigeria’s money supply continued to expand in June despite one of the highest interest rate environments in recent years, underscoring the resilience of domestic liquidity. While the CBN remains committed to fighting inflation through tight monetary policy, sustained growth in deposits and domestic assets suggests liquidity pressures remain an important factor shaping the country’s macroeconomic outlook.
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