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Impact of Monetary Policy Transmission Mechanisms on Capital Market Liquidity in Nigeria (2006-2020)

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  • Adeoye, Mary A.

    (Department of Management and Accounting, Ladoke Akintola University of Technology, Ogbomoso Oyo State, Nigeria)

  • Nasiru, Halimah Y.

    (Department of Management and Accounting, Ladoke Akintola University of Technology, Ogbomoso Oyo State, Nigeria)

Abstract

This study examined the impacts of monetary policy transmission mechanisms on the liquidity of Nigerian capital market from 2006-2020. The required data were sourced from Central Bank of Nigeria (CBN) statistical bulletin. Capital market liquidity is the dependent variable while the independent variables are; treasury bill rate, savings rate, net domestic credit, exchange rate and inflation rate. The Ordinary Least Square multiple regressions with econometric view were used as data analysis techniques. The study found that monetary policy transmission mechanism does not have significant impact on the liquidity of the capital market as against the findings of Akani and Imegi (2017). Also, all the channels of monetary policy transmission mechanisms have positive relationship with capital market liquidity except exchange rate. It therefore recommends that exchange rate should be worked upon so as to enhance the liquidity of Nigerian capital market in view of its negative impact on the capital market liquidity.

Suggested Citation

  • Adeoye, Mary A. & Nasiru, Halimah Y., 2021. "Impact of Monetary Policy Transmission Mechanisms on Capital Market Liquidity in Nigeria (2006-2020)," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 5(6), pages 169-174, June.
    • Handle: RePEc:bcp:journl:v:5:y:2021:i:6:p:169-174
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    References listed on IDEAS

    as
    1. Felicia Omowunmi Olokoyo & Babajide Michael Oyewo & Abiola A. Babajide, 2014. "Attitude of Investors to Capital and Money Market Investments Before and After Financial Crisis: Evidence from Nigeria," International Journal of Sustainable Economies Management (IJSEM), IGI Global, vol. 3(1), pages 53-64, January.
    2. Enchuan Shao, 2010. "Credit rationing and endogenous monetary policy," Applied Economics Letters, Taylor & Francis Journals, vol. 17(5), pages 437-443.
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