Internet Finance, Monetary Policy Effectiveness and Bank Credit Channel (Published)
With the information technology boom, the development of Internet Finance is justified to have a notable impact on the effectiveness of monetary policy. In allusion to the development of Internet Finance and changes in monetary policy from 2007 to 2018, this paper takes the bank credit transmission channels as an entry point and builds a Vector Error Correction (VEC) Model based on co-integration analysis. In this paper, we attain the influence of Internet Finance on intermediate targets and ultimate targets of monetary policy with the methods of Co-integration analysis, Granger test, VEC model and so forth by comparing bank credit channels and interest rate channels. The results of the research have revealed that Internet Finance weakens the transmission effect of monetary policy through bank credit channels, improves the market endogenous nature of money supply, which hinders the achievement of the ultimate goal of monetary policy.
Keywords: Monetary Policy, VEC Model, bank credit channel, internet finance
Monetary Policy and the Performance of Nigeria Capital Market: A Time Variant Analysis (Published)
This study examined the relationship between monetary policy and the performance of the Nigerian capital market using annual time series data sourced from the Central Bank of Nigeria Statistical Bulletin. The objective was to examine the long and short run relationship that exists between monetary policy variables and the performance of Nigerian capital market. Market capitalization and market turnover was modeled as the function of interest rate, exchange rate, monetary aggregates, monetary policy rate and treasury bill rate. The study applied the Ordinary Least Square (OLS) regression technique and causality, unit root, cointegration, vector error correction estimates. Findings revealed that interest rate, exchange rate monetary aggregate and monetary policy rate have positive and significant relationship with market capitalization but treasury bill rate have negative and significant relationship with market capitalization. Monetary policy rate, monetary aggregate and exchange rate have positive relationship with market turnover while Treasury bill rate and interest rate have negative and significant relationship with market turnover. The unit root test found the variables stationary at first difference, the cointergration test validates the presence of long run relationship, the granger causality test proved unidirectional causality while the vector error correction estimates justified adequate speed of adjustment. The study concludes that monetary policy has significant relationship with performance of Nigeria capital market. We recommend that the monetary authorities should ensure effect monetary policy transmission mechanism that will enhance the performance of the capital market.
Keywords: Capital market, Exchange Rate, Monetary Policy, Time Series Monetary Policy Rate
Effect of Government Policy on Price Stability (1990-2015) (Published)
The study determines the effect of government policies in both monetary and fiscal policies on price stability in Nigeria. Secondary data were sourced from CBN statistical bulletin for GR, GE, CRR, MPR & CPI. The study using OLS technique discovered that the combination of both monetary and fiscal instruments impacted on consumer price index in Nigeria within the period of review and concludes that regardless of the mixed individual impacts of the variables; government policies were able to manage consumer price index to a considerable extent. Thus, recommends enhanced fiscal procedures and monetary policies to facilitate desired price stability.
Keywords: Fiscal Policy, Monetary Policy, Price Stability