The Central Bank of Nigeria (CBN) has disclosed that the currency’s value in circulation jumped to N3.97tn at the end of May, 2024 representing an all-time high and a 1.07 per cent increase over the previous month.
The data released on the CBN website on Sunday, 9 June, 2024 indicated that the currency in circulation has been rising consistently over the months from N3.92tn in April to N3.86tn in March.
The currency in circulation has been increasing month-on-month despite the CBN monetary policy tightening which has seen the benchmark interest rate set at 26.65 per cent.
Currency in circulation represents banknotes and coins that have been produced and issued for use in the economy.According to the apex bank, currency in circulation at N3.87tn in March 2024 represented about a 4.76 per cent month-on-month increase from N3.69tn in February 2024.
Meanwhile, currency outside banks also increased progressively during the first quarter, growing from N3.28tn in January to N3.41tn and N3.63tn in February and March, respectively.
The data revealed that over 90 per cent of currency in circulation is held outside of the banking system, indicating Nigerians are holding more cash.
In their statements, one of the members of the Monetary Policy Committee of the CBN at their March meeting, Muhammad Abdullahi, explained that the apex bank had identified high currency outside banks as one of the monetary drivers of the country’s inflation. Currency in circulation hits N3.97tn in May 2024.
