CBN data shows Nigeria’s money supply drops to ₦123.36tn

Nigeria’s total money supply (M3) fell slightly to ₦123.36 trillion in January 2026, down from ₦124.4 trillion in December 2025, according to data from the Central Bank of Nigeria (CBN).

The small drop suggests there was slightly less money circulating in the financial system at the start of the year. The decline followed efforts by the CBN to tighten monetary conditions and reduce excess liquidity in the economy.

The CBN has been using tools such as Open Market Operations (OMO) and Treasury bill sales to remove extra cash from the banking system. These measures are part of the bank’s broader plan to control inflation and stabilize the foreign exchange market.

Broad money supply (M3) measures the total liquidity in the economy. It includes cash in circulation, demand deposits, savings deposits, time deposits, and foreign currency deposits.

Data from the report showed mixed changes in the components of money supply. Net foreign assets dropped sharply to ₦29.6 trillion, showing a decline in foreign currency holdings in the financial system.

However, net domestic assets increased to ₦93.76 trillion, mainly due to continued growth in lending and credit within the country.

Analysts at Norrenberger Research said the different movements between foreign assets and domestic assets highlight how domestic credit growth is helping sustain overall money supply, even as foreign assets decline.

Despite the slight month-to-month drop, the money supply is still significantly higher compared to the same period last year, showing that liquidity in Nigeria’s economy remains relatively high.

Economists say movements in money supply will continue to be closely watched to assess how effective the CBN’s monetary tightening policies are in managing inflation, exchange rate stability, and broader economic conditions.