Currency outside banks reached N2.26tn at the end of June 2023, a significant increase of 185.68% from N792.18bn in January 2023. Currency in circulation in the country rose by 87.05%, totaling N2.6tn in June 2023, compared to N1.39tn in January 2023.
The surge in currency in circulation followed a dip of 235.03% in February 2023 due to the implementation of the naira redesign policy by the CBN. During the period, the CBN mopped up N2.3tn from circulation as part of its monetary policy measures.
Opinion: The sharp increase in currency outside banks and currency in circulation reflects the impact of various monetary policies and economic conditions in Nigeria. As the CBN employs measures to stabilize the economy, it’s crucial to strike a balance between managing liquidity and preventing inflation. The surge in currency in circulation could have implications for inflationary pressures, and it is essential for the central bank to carefully monitor the money supply to maintain a stable and robust financial system. Maintaining a balance between liquidity management and preventing inflation is crucial for the country’s financial stability.
