Nigeria’s Money Supply Jumps 51% To N108.96 Trillion

Nigeria’s Money Supply Jumps 51% To N108.96 Trillion

Nigeria’s Broad Money Supply (M2) has increased by 51% Year-on-Year (YoY) to N108.96 trillion in November 2024 from N72.03 trillion in the corresponding period of 2023…READ MORE… 

High Government Borrowing Drives Up Money Supply

The increase in M2 reflects the high government domestic borrowing from the private sector, which was reflected in the data. The Central Bank of Nigeria (CBN) reported that money and credit statistics data released yesterday showed a six-month increase since April 2024. The M2 rose by 1.2% to N108.96 trillion in November from N107.7 trillion in October.

Quasi-Money and Demand Deposits Increase

Quasi-money, including savings deposits, time deposits, and other near-money assets, rose marginally by 1.96% YoY to N72.7 trillion from N71.3 trillion in November 2023.

Demand deposits increased by 34.4% YoY to N31.6 trillion in November 2024 from N23.2 trillion in November 2023.

Currency Outside Banks Increases

Currency outside banks increased by 50.9% YoY to N4.65 trillion in November 2024 from N3.08 trillion in November 2023.

Narrow Money (M1) Also Rises

Narrow money (M1), which includes currency outside banks and demand deposits, grew massively by 38% YoY to N36.3 trillion in November 2024 from N26.3 trillion in November 2023.

Credit to Government and Private Sector Increases

Credit to the government increased by 54% YoY to N39.6 trillion in November 2024 from N25.7 trillion in November 2023.

Credit to the private sector rose YoY by 27% to N75.96 trillion in November 2024 from N59.7 trillion in November 2023.

Net Domestic Credit Rises

This resulted in a 91% YoY rise in net domestic credit of N115.6 trillion in November 2024 from N60.5 trillion in the corresponding period of 2023.

Analysts Warn of Rising Debt Profile

Analysts at Afrinvest West Africa Limited warned that the Federal Government’s debt profile is rising, with a total debt profile estimated at N128 trillion, while the cumulative national debt profile is estimated at N138 trillion.

They also estimated that the actual deficit in 2024 would exceed the budgeted N9.2 trillion by 72.8% should the total expenditure plan of N35.1 trillion be fully accommodated.

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