Nigeria Economic Update (Issue 3)

Issue 3

Provisional Monetary statistics by the CBN show an increase in currency in circulation – a portion of overall money supply. Specifically, currency in circulation rose (Month-on-Month) by 14.2 percent to N2.2 million in December 2016 – the highest Month-on-Month increase recorded for the year 2016. The rise in currency- outside-bank may be attributed to the growing demand for cash balances for spending activities during the festive period. This development would largely compound the liquidity problem associated with TSA implementation and ongoing CBN monetary tightening as deposit money banks might be cash-strapped. Going forward, efforts should be geared towards intensifying initiatives that promote a cashless economy that encourages cashless transactions.


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