Effect of Monetary Policy of the Growth of the Nigerian Economy (empirical Analysis 2010 - 2019)

Student: Lauretta Onyinyechi Ndukwu (Project, 2025)
Department of Accountancy
Federal Polytechnic, Nekede, Imo State

Abstract

This study investigated the effect of monetary policy on the economic growth in Nigeria. The natural log of the GDP was used as a dependent variables against the explanatory monetary policy variables; monetary policy rate, money supply, exchange rate, lending rate and investment. the time series data is the market control period covering 2010-2019. The study adopted the chi- square method. The study showed that long run relationship exist among the variables. In addition, the core finding of this study showed that monetary policy rate interest rate, and investment have insignificant positive effect on economic growth in Nigeria. Money supply however have positive. significant effect on growth in Nigeria. Exchange rate have significant negative effect on GDP in Nigeria. Money supply and investment, granger cause economic growth, while economic growth causes interest rate in Nigeria. On the overall, monetary policy explains 98% of the changes in Nigeria. Thus, the study concluded that monetary policy can be effectively used to control Nigerian economy and thus veritable tools for price stability and improve output.

Keywords
Money monetary supply exchange rate open market operation moral suasion credit control finance investment money lending rate
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