Market News

By Abdullateef Aliyu, Lagos

Nigeria’s broad money supply (M3) increased by N1.25 trillion to reach N119.04 trillion in October 2025, up from N117.78 trillion in September 2025, according to the latest money and credit statistics from the Central Bank of Nigeria (CBN).

This marks a 1.06% month-on-month increase, indicating continued growth in the financial system’s liquidity.

Year-on-year, M3 rose by N11.04 trillion, or 10.22%, compared to N107.99 trillion recorded in October 2024, signaling a sustained expansion in the money supply over the past year. This ongoing growth in broad money supply highlights the liquidity dynamics within the economy as Nigeria navigates post-pandemic recovery and evolving macroeconomic conditions.

The uptick in M3 occurred just one month after the Monetary Policy Committee (MPC) of the Central Bank of Nigeria reduced the Monetary Policy Rate (MPR) by 50 basis points to 27% during its September 2025 meeting.

This was the first rate cut since 2020, reflecting the bank’s response to easing inflationary pressures and improved foreign exchange conditions.

The rate cut was seen as a sign of the central bank’s efforts to balance supporting economic growth while managing inflation, which had remained persistently high in recent years.

The decision to lower the MPR was aimed at stimulating credit growth and encouraging investment, which could, in turn, help to boost economic activity.

The expansion in M3 points to a significant increase in the liquidity available in the financial system. Broad money supply (M3) includes currency in circulation, demand deposits, savings deposits, and time deposits, reflecting the total money available for spending, lending, and investment within the economy.

This growth is typically seen as an indicator of the central bank’s policy stance, aimed at managing economic expansion while controlling inflation, according to experts.

The data also indicated that the currency in circulation rose to N5.05 trillion from N4.9 trillion in the previous month.

A source stated that the CBN’s recent policy decision has been focused largely on inflation easing because inflation – still at double-digit rate – remains a problem.

“So what the CBN has been doing is to ensure that it controls the quantum, the quantity, and the price of money in circulation in such a way that it is manageable and does not overheat the economy,” the expert said, pleading not to be named.