TO GET THE COMPLETE JOURNAL/THESIS FOR TOPIC BELOW,
CALL: 08168759420, 08068231953
WHATSAPP: 08137701720
THE STOCK MARKET CHANNEL OF MONETARY POLICY AROSANYIN: ISSUES IN NIGERIA’S TRANSPORT DATA FOR PLANNING AND INTERNATIONAL COMPARISON TRANSMISSION MECHANISM IN NIGERIA
ABSTRACT
The Nigerian financial sector is undergoing some fundamental reforms. These reforms have brought with it increases in the number of financial variables and increased participation of ordinary citizens in the economy, more especially in the stock market. The nature and level of economic activities in the economy have increased and the stock market is poised to play an increasing role as the financial sector reform takes hold. In order to achieve the goals of financial deepening and sustainable development, monetary policymakers need to pay attention to the impact of policy action on the activities of the Nigerian Stock Exchange. Using monthly data and VAR and ECM, economic methodologies, the stock market reactions to monetary policy decision were examined in this paper. The conclusion is that while the stock market is still at the developmental stage, Monetary Policy Rate (MPR) was found to have a negative and significant effect on the activities of the Nigerian Stock Market by impacting liquidity and credit conditions. Thus, Central Bank’s monetary policy rate can be used to send signals to stock market investors, and, therefore, acts as a good anchor in the economy.
Keywords: Monetary Policy, Transmission Mechanism, Stock Market