MONETARY POLICY AND ECONOMIC GROWTH IN NIGERIA
Abstract
ABSTRACT
This study examines the trend and pattern of monetary policy tools and economic growth in Nigeria. It also determines the effect monetary policy has on economic growth in Nigeria and determines the direction of causality between monetary policy and economic growth in Nigeria through the use of descriptive statistics such as tables and graphs and econometrics technique such as Autoregressive Distributed Lag (ARDL) and Granger causality test. Annual secondary data from 1986 to 2023 on economic growth proxied by real Gross Domestic Product (GDP) and monetary policy proxied by M2, real interest rate was sourced from the World Bank and Central Bank Statistical Bulletin 2024 Edition.
The results shows that economic growth faced an upward movement while the trend of money supply was also positive and followed an upward trend in Nigeria during the study period. In addition, the results shows that in the short run, economic growth has a negative significant relationship with a coefficient of (-0.2130) and a p-value of (0.0106) but a positive significant relationship with in the long runwith a coefficient of (0.1435) and a p-value of (
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