Monetary Policy Dynamics and the Stock Market Movements: Empirical Evidence from Nigeria
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The contributions of the stock market to economic growth can never be over-emphasized. In this paper,
we used the Autoregressive Distributed Lag bound testing estimation techniques to examine the existence of any
relationship between monetary policy instruments and the stock market in Nigeria based on the data sourced
from 1985 to 2013. From the results obtained, it can be deduced that monetary policy instruments significantly
exerts on stock market behaviour in Nigeria. We recommends that policy makers should put in place policies that
aimed at adjusting the interest rate upward, reduce or at best keep at constant the money supply growth rate,
increase the net credit to the private sector and manipulate the exchange rate regime so as to boost stock
market.
Keywords
HF5601 Accounting, HG Finance