Nigeria’s broad money supply (M3) surged to N122.95 trillion in November 2025 from N119.04 trillion in October, signalling a continued expansion in system liquidity despite the Central Bank of Nigeria’s (CBN) broadly tight monetary stance.
This is according to the latest data released by the CBN, which shows that liquidity conditions in the banking system remain accommodative even as the apex bank maintains elevated policy rates.
The increase reflects stronger domestic credit growth and improved foreign asset positions, raising questions about how the CBN manages liquidity without undermining inflation and exchange rate stability.
What the data is saying
The CBN data show that broad money supply (M3) rose by N3.91 trillion month-on-month to N122.95 trillion in November 2025.
On a year-on-year basis, M3 expanded significantly from N108.97 trillion recorded in November 2024.
The growth in money supply was driven by increases in both net domestic assets (NDA) and net foreign assets (NFA).
NDA rose to N85.57 trillion in November from N84.23 trillion in October, reflecting higher banking sector claims on government and the private sector.
Net foreign assets also improved sharply, increasing to N37.38 trillion in November from N34.80 trillion in October.
Compared with November 2024, NFA more than doubled from N17.35 trillion, pointing to stronger foreign exchange inflows and improved external buffers.
Other monetary aggregates followed a similar trend. Broad money measured by M2 increased to N122.94 trillion in November from N119.03 trillion in October, while narrow money (M1) rose to N40.53 trillion from N39.35 trillion, indicating higher transactional balances in the economy.
Context behind the numbers
The expansion in money supply comes against the backdrop of recent monetary policy adjustments by the CBN.
In September 2025, the Monetary Policy Committee (MPC) cut the Monetary Policy Rate (MPR) by 50 basis points to 27 per cent.
The decision was taken amid easing inflationary pressures and relatively improved foreign exchange conditions.
However, at its November meeting, the MPC opted to hold the MPR at 27 per cent, signalling caution as liquidity conditions continued to loosen.
Sustained growth in NDA often reflects increased government borrowing, rising credit to businesses and households, or a rebalancing of banks’ portfolios toward domestic assets.
At the same time, the sharp improvement in NFA suggests stronger external sector performance, supported by higher foreign inflows and better reserve positions.
While this combination supports economic activity, it also increases the risk of excess liquidity if not carefully managed.
What this means
The simultaneous rise in domestic and foreign assets indicates that liquidity growth in Nigeria is being driven by both internal credit expansion and improved external conditions.
While this supports economic recovery and lending, it complicates the CBN’s fight against inflation and exchange rate volatility.
By maintaining a tight policy stance in November, the CBN appears to be signalling its intention to prevent rapid money supply growth from undermining recent disinflation gains.
