Following the value of Nigeria’s currency in circulation, which has increased to N3.87tn at the end of first quarter in 2024.

This is according to the latest money and credit statistics on the Central Bank of Nigeria website, the currency stood at N3.87 trillion at the end of March 2024, higher than N3.69 trillion in February and N3.65 trillion in January.

However, currency outside banks have also increased progressively during the first quarter, growing from N3.28tn in January to N3.41tn and N3.63tn in February and March, respectively.

The data disclosed that over 90 percent of currency in circulation is held outside the banking system, indicating that Nigerians hold more cash.

From the news gathered, Muhammad Abdullahi, one of the members of the Monetary Policy Committee of the CBN at their March meeting, stated that the Apex bank has identified high currency outside banks as one of the monetary drivers of the country’s inflation.

He said, “From available data, prices of domestic food items remain the major driver of headline inflation because of supply shortages and high cost of logistics and distribution.

“While this cannot be directly influenced using monetary policy tools, the bank’s response to the drivers of headline inflation is targeted at addressing identified monetary drivers such as money supply growth, exchange rate depreciation and Currency-Outside-Banks, the combined impact of which will dampen inflationary pressure significantly.”

In January 2024, at the height of the currency redesign policy, currency in circulation stood at N1.386tn, with the percentage of the cash outside the banks at 57 per cent at N792.184 billion.

The cash outside banks rose to N843.311bn, representing 85.9 percent of the N982.097bn that was in circulation by February.

CIC, outside the banking system, said it dropped further in March to 85.8 percent with N1.445tn of the N1.683tn.