Currency in circulation rises to N2.84tn

The currency in circulation increased by N58.36 billion in September to N2.84 trillion, up from N2.79 trillion in August.

The Central Bank of Nigeria (CBN) revealed this in its most recent statistics published on its website on Sunday.

Money in circulation refers to actual cash outside the CBN’s vaults, i.e. all legal tender currency in the hands of the general public and in the vaults of Deposit Money Banks (DMBs).

Breakdown of CBN data shows in July N2.81 trillion was in circulation in the economy, up from N2.74 trillion at the end of June.

However, CIC decreased to N2.79 trillion in May from over N2.80 trillion at the end of April.

Explaining further how CIC in the country is measured CBN said it employed the “accounting/statistical/withdrawals and deposits approach” to arrive at its figure

According to the Apex bank, this approach involved tracking the movements in currency in circulation on a transaction-by-transaction basis.

Read also: Court approves launch of CBN’s digital currency

“For every withdrawal made by a DMB at one of CBN’s branches, an increase in CIC is recorded; and for every deposit made by a DMB at one of CBN’s branches, a decrease in CIC is recorded.

“The transactions are all recorded in the CBN’s CIC account, and the balance on the account at any point in time represented the country’s currency in circulation,” it stated.

CBN data also showed there is a growth of net foreign assets and net domestic assets by 12.35 and 4.30 percent respectively in August 2021, compared to 1.84 and 3.17 percent in July.

The apex bank noted that the growth in net foreign assets was largely driven by an increase in foreign asset holdings of commercial and merchant banks.

It said the increase in net domestic assets reflected the boost to aggregate credit net, which increased to 8.14 percent in August from 5.71 percent in July.

While in the money market, the monthly weighted average interbank call and open buyback rates increased to 13.45 and 12.97 percent in August respectively from 10.72 and 11.60 percent in July.

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