SAT APRIL 26 2025-theGBJournal| The pace of growth of Credit to the Private Sector has slowed significantly compared to the previous year due to the waning impact of currency depreciation on banks’ foreign-denominated assets, following the recent stability of the naira.
The latest Central Bank of Nigeria (CBN) data reflects the slow down. CPS increased by only 6.8% y/y to N76.27 trillion in March 2025 when compared to March 2024 N71.43 trillion.
On the other hand, credit to the government rose by 28.9% y/y to N25.86 trillion (March 2024: N20.05 trillion), indicating increased government borrowings from domestic banks for deficit financing.
Overall, broad money supply (M3) grew by 23.9% y/y to N114.22 trillion, following increases across quasi (+26.6% y/y) and narrow (+19.7% y/y) money supply.
On a month-on-month basis, the CPS increased marginally by 2bps to N76.27 trillion in March (February: -1.4% m/m to N76.26 trillion), due to the prevailing tight financial conditions in the local economy.
CPS is expected to remain subdued in the near term, constrained by the prevailing tight monetary policy environment
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