ABSTRACT

This study examined the effect of monetary supply on economic growth in Nigeria for a period of 36 years (1981-2015). The study adopted econometric techniques of the Ordinary Least Square and Error Correction Mechanism to analyze the time series data. The study found out that money supply is negative and insignificant at influence economic growth in Nigeria. The study further revealed that monetary policy rate is a significant negative determinant of economic growth in Nigeria. The study finally showed that exchange rate is negatively related to economic growth in Nigeria and there is no causal relationship between economic growth and money supply in Nigeria. The study recommended that government through the monetary authorities should maintain stable and low exchange rate and avoid actions that will lead to exchange rate fluctuations.