Currency in Circulation Hits All-Time High as CBN Makes Loans Very Expensive for Nigerians
- The Central Bank of Nigeria (CBN) has said currency in circulation has hit a historic high of N3.69 trillion for February 2024
- This figure represents a 1.8% increase to the N3.65 trillion reported in January 2024, the highest since Cardoso became CBN governor
- The bank recently increased the benchmark interest rate by 200 basis points to 24.7%, Nigeria's highest ever
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Legit. ng's Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The Central Bank of Nigeria has said that the currency in circulation reached a historic high of N3.69 trillion in February 2024.
The development is coming after CBN tightened monetary policy and raised MPR at its last MPC meeting.
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Money in circulation increased by 1.8% - CBN
The recent data represents an increase of N43.07 trillion or 1.8% month-on-month from N3.65 trillion reported in January 2024 and N443.38 billion or 13.64% yearly from N3.25 trillion reported in February 2023.
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Currency in circulation refers to the amount of cash within a country that is physically used to transact business between consumers.
In its latest money report, the bank said that the currency in circulation closed December 2023 at N3.65 billion from N1.39 trillion reported in January 2023.
When Olayemi Cardoso resumed office as CBN governor, currency in circulation stood at N2.76 trillion. The amount has since increased by N892.01 billion to close at the current figure.
According to the CBN data, as of February this year, currency outside banks stood at N3.41 trillion, representing a growth of N130.54 billion or 3.98% from N3.28 trillion in January.
CBN hikes interest rates to 24.7%
ThisDay reports that the recent spike in currency in circulation could be attributed to the cash scarcity in 2023.
Despite the spike in currency in circulation, Nigeria's economic growth has been sluggish, with the growth rate in 2024 projected at 2.9% and 3.1%, one of the slowest in West Africa.
The country has been battling high inflation, which hit a significant high in February 2024 at 31.70% from 29.9% reported in January 2024.
At its recent Monetary Policy Committee (MPC) meeting on Tuesday, March 26, 2024, the apex bank raised the MPR by 200 basis points at 24.75%, a historic high from the 18.75% recorded recently.
Analysts believe the latest effort is the bank's proactive stance towards monetary tightening amid a challenging economic environment.
CBN announces changes to customs forex rate
Legit.ng earlier reported that the continued gain of the naira in the official and parallel markets has brought some relief to importers as the Central Bank of Nigeria (CBN) again slashed the exchange rate for Customs duties at Nigerian ports by three per cent.
The apex bank reviewed the FX duties downward from N1,448.386 per dollar to N1,405.466 on Tuesday, March 26, 2024.
The development is according to data available at the official trade portal of the Nigeria Customs Service (NIS).
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Source: Legit.ng
