Nigeria’s money supply surged by 18.3% year-on-year (YoY) to reach N110.97 trillion in January 2025, up from N93.77 trillion in January 2024, driven largely by increased savings in investment instruments.
According to the latest Money and Credit Statistics released by the Central Bank of Nigeria (CBN), this rise was fueled by a 21% jump in quasi-money—which includes savings accounts, treasury bills, money market instruments, and foreign currency deposits—hitting N74.07 trillion compared to N61.2 trillion the previous year.
The data also showed a 44.5% increase in currency outside banks, climbing from N3.28 trillion to N4.74 trillion, while narrow money (M1) rose 16.7% YoY to N36.9 trillion. Meanwhile, demand deposits grew 13.6% to N32.15 trillion, reflecting a more active financial environment.
Public Debt Rises as Government Borrowing Soars
Amid the expansion in money supply, Nigeria’s public debt increased by 6% quarter-on-quarter to N142.3 trillion in Q3 2024, according to data from the Debt Management Office (DMO). Government borrowing spiked by 54% YoY, reaching N24.51 trillion in January 2025.
However, credit to the private sector declined by 2.09% YoY, dropping from N76.5 trillion to N74.9 trillion, leading to a 0.5% decline in net domestic credit, which stood at N99.4 trillion.
Experts Warn of Economic Risks
Financial analysts at Cowry Asset Management Limited attributed the growing public debt to budget shortfalls, increased borrowing, and the continued depreciation of the naira. They cautioned that Nigeria’s fiscal position remains fragile, emphasizing the need for structural reforms and revenue diversification to ensure economic stability.
As Nigerians ramp up savings and investments, the surge in money supply highlights growing financial activity, but experts warn that rising public debt could pose risks to long-term economic growth.
