ABSTRACT

The purpose of this project is based on the effect of monetary policy on economic growth in Nigeria. This work discussed the meaning of monetary policy as monetary management techniques put in place by the government through the central bank to control money stock in order to influence broad macro-economic objectives. The data used is a secondary data collected from central bank of Nigeria statistical bulletin between the periods of 1981 to 2014, and multiple regression analysis of ordinary least square (OLS) were used. The variables of the model includes: GDP Growth as the dependent variable and broad money supply, interest rate, and monetary policy rate as the independent variables. The result shows that money supply is statistically significant, which means that money supply influences growth positively in Nigeria. On the other hand, interest rate and monetary policy rate are statistically insignificant showing that interest rate and monetary policy rate are negatively influences economic growth in Nigeria. Government should increase its expenditure on productive sectors to boast economic growth alongside with monetary policy.