Serial Article
| DOI |
10.7336/academicus.2016.13.03 |
| URL |
https://academicus.edu.al/?subpage=volumes&nr=13 |
| Multiple Resolution: |
| MR URL |
https://academicus.edu.al |
| MR URL |
https://academicus.edu.al/nr13/Academicus-MMXVI-13-040-053.html |
| MR URL |
https://academicus.edu.al/nr13/Academicus-MMXVI-13-040-053.pdf |
| MR URL |
mailto:info@academicus.edu.al |
| MR URL |
https://academicus.edu.al/images/front_end/academicus.jpg |
| MR URL |
https://creativecommons.org/licenses/by-nc-nd/4.0/ |
| Acess Indicators: |
|
OA – Open Access |
| OA License |
https://creativecommons.org/licenses/by-nc-nd/4.0/ |
Full Title
English
(eng)
|
Academicus International Scientific Journal |
| Publisher (01) |
Academicus International Scientific Journal |
| Country of publication |
Albania
(AL)
|
|
ISSN
|
20793715 |
| Product Form |
Printed Journal
(JB)
|
|
ISSN
|
23091088 |
| Product Form |
Online Journal
(JD)
|
| Journal Volume Number |
13 |
| Journal Issue Date (YYYY/MM) |
2016 / 01 |
Title
English
(eng)
|
Inflation, exchange rate and efficacy of monetary policy in Nigeria: The empirical evidence |
|
By (author)
(A01)
|
BigBen Chukwuma Ogbonna |
| Affiliation |
Department of Economics, Ebonyi State University Abakaliki, Nigeria, Dr. |
| Number of Pages |
14 |
| First Page |
40 |
| Last Page |
53 |
| Language of text |
English
(eng)
|
| Publication Date (YYYY/MM) |
2016 / 01 |
| Copyright |
2016, Academicus |
Abstract
Main description
(01)
|
This paper analyses the post SAP persistence of inflation in Nigeria for the period, 1960-2008 with exchange rate, money supply
and trade balance as preferred influential variables. To investigate the effect of policy switch from the period of direct
instrument to the period of deregulation occasioned by SAP of 1986, we proceed to bifurcate the sample period into two, comprising
the period of direct instruments of monetary policy, 1960 – 1985 and the period of indirect instruments of monetary policy,
1986 – 2008. Estimates from a vector auto regression model (VAR) of key macroeconomic variables demonstrate the weak link
between money supply and inflation in the both time horizons, which suggests that the hypothesis that money supply is not
an effective policy instrument for management of inflationary developments cannot be rejected for Nigeria. The results further
suggest that in both time horizons, exchange rate has been identified as a singular most promising macroeconomic fundamental
for both internal and external sectors adjustments. However, the deregulation of the domestic economy as occasioned by SAP
has significantly diluted the efficacy of exchange rate as a monetary policy instrument for the management of Nigeria’s aggregate
money stock and trade balance developments. These notwithstanding, the Central Bank of Nigeria can continue to play a stabilizing
role in the economy through the continuation of prudent monetary policies and frequent interventions in exchange rate management
to smooth out shocks.
|
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