Nigeria’s broad money supply (M3) rose to N122.95 trillion in November 2025, up from N119.04 trillion in October, indicating a continued expansion of liquidity in the financial system despite the Central Bank of Nigeria’s generally tight monetary policy.

Data from the CBN shows that banking system liquidity remains ample even as the apex bank maintains elevated policy rates.

The rise in M3 reflects stronger domestic credit growth and improved foreign asset positions, prompting questions about how the CBN manages liquidity while safeguarding inflation and exchange rate stability.

The CBN data show that broad M3 rose by N3.91 trillion month-on-month, reaching N122.95 trillion in November 2025.

On a year-on-year basis, M3 expanded sharply from N108.97 trillion in November 2024.

The increase was supported by growth in both net domestic assets and net foreign assets.

NDA rose to N85.57 trillion in November from N84.23 trillion in October, reflecting higher banking sector claims on the government and private sector. Meanwhile, NFA climbed to N37.38 trillion from N34.80 trillion over the same period, indicating a notable improvement in foreign asset positions.

Compared with November 2024, net foreign assets more than doubled from N17.35 trillion, reflecting stronger foreign exchange inflows and improved external buffers.

Other monetary aggregates showed similar growth. Broad money measured by M2 rose to N122.94 trillion in November from N119.03 trillion in October, while narrow money (M1) increased to N40.53 trillion from N39.35 trillion, pointing to higher transactional balances in the economy.

The expansion in money supply comes amid recent monetary policy adjustments by the CBN.

In September 2025, the Central Bank of Nigeria’s Monetary Policy Committee cut the Monetary Policy Rate by 50 basis points to 27 per cent, citing 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 amid continued loosening of liquidity in the banking system.

Sustained growth in NDA often reflects increased government borrowing, higher credit to businesses and households, or a rebalancing of banks’ portfolios toward domestic assets.

Meanwhile, the sharp rise in NFA points to stronger external sector performance, supported by higher foreign inflows and improved reserve positions.

While rising domestic and foreign assets support economic activity, they also heighten the risk of excess liquidity if not carefully managed.

The growth in both internal credit and external inflows indicates that Nigeria’s money supply expansion is being driven by a combination of domestic lending and stronger foreign exchange conditions.

This dual growth helps economic recovery and boosts lending, but it also complicates the CBN’s efforts to control inflation and maintain exchange rate stability.

By keeping the policy rate unchanged in November, the central bank signals its commitment to preventing rapid money supply growth from undermining recent disinflation progress.