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Central Bank of Nigeria economic report, 2009

The total money in circulation in July, increased by 0.2 per cent to N1,008.3 billion over the level in the preceding month. The rise, according to the Central Bank of Nigeria was due to the 2.7 per cent increase in currency outside the banks.

The CBN, in its quarterly economic report , said total deposits at the CBN amounted to N5,433.6 billion, indicating a 0.8 per cent increase over the level in June 2009. The development, the report stated, was as a result of the rise in Federal Government and other deposits, adding that the shares of the Federal Government, banks and “others” in total deposits at the CBN were 89.4, 3.7 and 6.9 per cent, respectively, compared with the shares of 89.3,5.3 and 5.4 per cent, in June 2009.

Additionally, the CBN said aggregate banking system’s credit (net) to the domestic economy rose by 4.6 per cent to =N=5,938.1 billion in July 2009, compared with the increase of 3.6 per cent in the preceding month. The development was attributed wholly to the 5.5 per cent increase in claims on the private sector.

At N3,088.0 billion, banking system’s credit (net) to the Federal Government declined by 7.2 per cent, compared with the fall of 4.9 per cent in June 2009. The fall was attributed wholly to the 11.1 per cent decline in deposit money banks’ (DMBs) holdings of government securities during the month.

According to the apex bank, banking system’s credit to the private sector rose by 5.5 per cent to =N=9,026.1 billion, compared with the increase of 0.6 per cent in June 2009. This reflected largely the 4.6 per cent increase in Deposi Money Bank’s ( DMBs) claims on other private sector..

On the contrary,, foreign assets (net) of the banking system declined by 1.2 per cent to =N=7,554.0 billion , as against the increase of 0.1 per cent in the preceding month. The CBN attributed the development to the fall in both the CBN’s and DMBs’ holdings.

Similarly, quasi money fell by 0.2 per cent to =N=4,585.6 billion, in contrast to the increase of 4.4 per cent in June 2009. The development, again reflected the decline in all the components, namely, time, savings and foreign currency deposits of the DMBs.

The report noted that other assets (net) of the banking system, also, fell by 8.5 per cent to =N=4,602.8 billion, compared with the decline of 3.4 per cent in the preceding month. The fall was attributed to the decline in unclassified assets of both the CBN and the DMBs.

Source: The Nation