Besides, monetary policy is found to be more important in the dynamics of inflation compared to fiscal policy. Annual time series data, sourced from central bank of nigeria cbn. What is the impact of monetary policy on inflation control. Nigeria to what extent has the application of monetary policy in nigeria brought about sanity in the operation of commercial banks. The central bank of nigeria cbn, however, has made efforts to fight it using different policy measures, of which monetary policy is one of them.
We recommended that for sustainable economic growth to be achieved in nigeria, the level of inflation should be stabilized by the monetary authorities. Also, government, cbn, and other policy makers will benefit from this topic as it would provide a platform through which the various monetary policies will be explained in terms of how they suit the socialpolitical environment of nigeria. It evaluates studies and research papers done on both monetary policies and inflation. This pdf is a selection from an outofprint volume from the national.
In this context, one of the main principal tools of monetary policy being used by the central bank of nigeria to control economic activities is the monetary policy rate. Impact of inflation on macroeconomic variables inflation. The objective of this study was to investigate empirically the impact of monetary policy on nigeria s macroeconomic stability between 1970 and 2009. Monetary policy and inflation dynamics in ethiopia. The impact of monetary policy in controlling inflation in nigeria, largest undergraduate projects repository, research works and materials. Furthermore, var granger causality test suggests the causation running from budget deficit to money supply. One of the major objectives of monetary policy in nigeria is stabilization of.
These objectives are simply referred to as goals or as ultimate goals of monetary policy. Monetary policy measures and inflation accountingcontrol. This study examined the role of monetary policy instruments in controlling inflation in nigeria. The dynamics of monetary policy and inflation in nigeria. This study determines the effectiveness of monetary policy in controlling inflation in kenya. Please, sit back and study the below research material carefully. Impact of monetary policy on industrial growth in nigeria.
Monetary policy does not have a significant effect on inflation. Based on these findings, it was recommended that monetary supply, interest rates and exchange rates should be the principal policy variables to be manipulated in controlling inflation in nigeria. Within the nigeria economy, the effects of inflation includes expansion of. Nigeria has experienced high volatility in inflation rates. Objectives of the study this study basically aims at examining the impact of monetary policy on the economic development of nigeria via its impact.
When this happens, prices rise and the currency within the economy is worth less than it was before. Monetary policy cooperant factors have significant impact on economic growth in nigeria. Inflation, economic growth, multiple regression model, monetary policy, nigeria. Take a deeper look at how contemporary central banks attempt to target and control the level of inflation through monetary policy tools. Impact of monetary policy on controlling inflation in nigeria. The impact of government spending on inflation through the. The three objectives of monetary policy are controlling inflation, managing employment levels, and maintaining long term interest rates. A general overview of monetary policy and inflation in the nigerian economy is the foundation upon which the project is developed.
Effectiveness of monetary policy in controlling inflation. The study investigated effect of monetary policy on economic growth in nigeria. Download the complete economics project topic and material chapter 15 titled impact of monetary and fiscal policies on inflation in nigeria here on projects. The main purpose of this study is to empirically examine the effectiveness of monetary policy in controlling inflation in nigeria. This project covers the role of monetary policy and its controlling inflation in the nigeria economy. There are two major control mechanisms of monetary policy. Pdf this study examined the effectiveness of monetary policy and control of. This has led to reduction in the standard of living of nigerians. The impact of monetary policy in controlling inflation in nigeria, free undergraduate project topics, research materials, education project topics, economics project topics, computer. Monetary policy involves changing the interest rate and influencing the money supply. The impact of monetary policy on the economic growth of. Impact of monetary policy on economic growth in nigeria.
One of such policies was the price policy price control in 1971 meant to control. This policy of monetary targeting is expected to help the rbi in the use of its monetary policy instruments for controlling inflation and stabilising the general price level. Given the problems raised above, this study seeks to examine the impact of monetary policy on inflation control in nigeria from 1970 to 2010. Monetary policy cooperant factors do not have significant impact on economic growth in nigeria.
This has led to a reduction in the standard of living of nigerians. Impact of monetary policy in controlling inflation in nigeria. The central bank of nigeria cbn, however, has made efforts to fight it using different policy measures of which monetary policy. It is a policy used to pursue policies of higher economic growth or controlling. Inflation is a major problem facing nigeria as a country today. The effectiveness of monetary policy in the control of inflation in. Uniprojects aim of providing this impact of fiscal and monetary policy in controlling unemployment in nigeria. Monetary policy can be developed for encouraging investment and controlling inflation, while fiscal policy can be effective to reducing consumption of luxury and ostentation goods. The main thrust of this study shall be on the impact of fiscal and monetary policy instruments on the economic growth of nigeria. The fed implements monetary policy through open market operations, reserve requirements, discount rates, the federal funds rate, and inflation. The natural log of the gdp was used as the dependent variables against the explanatory monetary policy variables. In addition to her contemporary fiscal and monetary policies, the nigerian government had implemented various other policies aimed at curbing inflation in the country. Impact of monetary policy on inflation control in nigeria.
The specific objectives of this study are to examine. The money supply variable shows a significant positive impact on inflation both in short. Changing views on the role and effectiveness of monetary policy. Given the problems raised above, this study seeks to examine the impact of monetary policy on inflation control in nigeria. Download this complete banking and finance project material titled. A vecm technique was employed to analyze and draw policy inferences. These goals, which are in line with basic macroeconomic objectives included, low unemployment, high output 2. This chapter analysis the literature on monetary policy tools and inflation.
Impact of fiscal and monetary policy in controlling unemployment in nigeria project material. Examine the effect of monetary policy on inflation in nigeria. Doc the impact of monetary policy on inflation in nigeria shetima. Impact of monetary policy on inflation control in nigeria munich.
By exploring the impact of monetary policy in controlling inflation at a time when inflation is rising in nigeria makes it very significant. A general overview of monetary policy and inflation in the nigerian economy is the foundation upon. Request pdf impact of monetary policy on controlling inflation in nigeria the main purpose of this study is to empirically examine the impact of monetary. Thus this paper focuses on the use of monetary policy to check inflation in nigeria.
They showed it is clear that monetary policy exacted greater impact on the economic growth but the effects of fiscal policy had lower magnitude more specifically when there is decrease in the inflation. The effectiveness of monetary policy as a tool for. It is in the light of the above scenario that this research intended to assess to what extent monetary policy variables have affected inflation and its control in nigeria. Inflation occurs when an economy grows due to increased spending. Fiscal and monetary policy and its effect on the growth of. Role of monetary policy in controlling inflation economics. The effectiveness of monetary policy in controlling inflation in nigeria with abstract, chapter 15, references and questionnaire. Monetary policy and inflation control in nigeria semantic scholar. Fiscalmonetary policy and economic growth in nigeria.
The researcher adopted the method of linear regression, the ordinary least square ols technique in analyzing the secondary data of inflation. Cheng 2006 study on the impact on monetary policy intervention in kenya showed that there were. The impact of monetary policy rate on inflation in nigeria. It uses secondary data on inflation, exchange rate, treasury bill. The impact of monetary policy on the economic growth of nigeria nwoko, nnenna m. But our major concern will be to explore the efficiency of monetary policy in an economy in controlling inflationary pressure in an economy like nigeria. Impact of monetary policy in nigeria on inflation, exchange. Monetary policy entails the government policies aimed at changing the quantity of money or credit condition for example, open market operation or changes in. Monetary policy and inflation in nigeria economy project. The study adopted interest rate, minimum rediscount rate, liquidity ratio, and cash reserve ratio as proxy for monetary policy instruments and the independent variables. In addition, the impact of monetary policy on growth in nigeria.
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