Data from the central bank of Nigeria reveals Money Supply otherwise termed M2 is now at a record high of N50.5 trillion as of October 2022.
This is the highest level ever reported for one of the most important monetary-related statistics tracked by Nigeria’s central bank or any central bank in the world. The increase in money supply was N1.26 trillion in October alone, the third highest month after April and May this year.
The amount of money supply in the country has risen by N6.1 trillion this year alone having closed at N44.4 trillion at the end of 2021. The increase is on track to beat the N6.6 trillion achieved in the whole of 2021.
Why this matters: An increase in the level of money supply in an economy is meant to deliver two major actions.
What you should know: The amount of money in supply has accumulated over the years largely due to the low-interest policy of the CBN (adopted to spur economic growth), trillions of naira in CBN intervention funds, and CBN bailouts of federal and state governments via its Ways and Means powers. The result is too much naira chasing dollars.
Coming up: The central bank’s monetary policy committee is set to meet on Monday and Tuesday, the 21st and 22nd of November respectively.
See chart:
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