…to overhaul fixed income market
Private Sector Credit Extension (PSCE) decreased by N302 billion to N75.83 trillion in August 2025 from N76.14 trillion in June 2025, latest data released by the Central Bank of Nigeria (CBN) has shown.
However, according to the “Money and Credit statistics,” posted by the apex bank on its website, yesterday, Year-on-Year (YoY), PSCE rose by 1.48 per cent, or N1.10 trillion, in August this year compared with N74.73 trillion in the corresponding period of 2024.
New Telegraph’s analysis of the CBN’s data indicates that net credit to the government also maintained a downward trend in August this year, dropping by 2.51 per cent, or N594.55 billion, to N23.13 trillion from N23.73 trillion in June 2025.
Similarly, Year-on-Year, net credit to the government fell by 25.74 per cent , or N8.02 trillion, in August 2025, compared with N31.15 trillion in the corresponding period of last year. Further analysis of the private sector fell, which fell for the third straight month in June this year, extended its decline in August.
The CBN has not released data for July. Analysts believe that the recent downtrend in net domestic credit reflects the impact of the Central Bank of Nigeria’s (CBN) monetary tightening measures, which saw the apex bank leaving the benchmark interest rate Monetary Policy Rate(MPR) unchanged at 27.5 per cent between November 2024 and July this year.
While the regulator’s measures have raised borrowing costs thereby helping to curb inflation and ensure naira stability, they have also made credit expensive for businesses generally. But with the apex bank’s Monetary Policy Committee (MPC) lowering the benchmark interest rate- Monetary Policy Rate (MPR)- for the first time in five years at the end of its meeting last month, analysts at Coronation Merchant Bank have predicted that there is likely to be an increase in PSCE to “credit-sensitive sectors” such as manufacturing, construction and real estate.
The analysts stated: “At its 302nd MPC meeting, the Monetary Policy Rate (MPR) was cut by 50 bps to 27 per cent, while an asymmetric corridor of +250/-250 bps was maintained. We believe this shift to a more accommodative stance, after a prolonged period of tightening, should start to ease financing constraints for businesses and households, boosting credit-sensitive sectors such as manufacturing, construction, and real estate, which moderated in Q2.”
Meanwhile, the CBN’s latest Money and Credit statistics,” indicates that Currency Outside Banks (COB) fell by 0.92 per cent, or N41.14 billion, to N4.45 trillion in August 2025 from N4.49 trillion in June this year. Also, Currency in Circulation dropped by 1.70 per cent to N4.92 trillion in August from N5.007 trillion in June 2025.
