Appraisal of The Effect of The Global Financial Meltdown on The Nigerian Money Market

Abstract

This study looked at the effect of the global financial meltdown on the Nigerian money market. To start with, it identified the major problems associated with the global financial crisis and its effects on the Nigeria economy. The Ordinary Least Square technique of regression analysis was adopted in analyzing the empirical data for non-crisis period from 2000-2005 and the crisis period from 2006-2009 after necessary adjustment were carried out on the relevant data. Money supply/Gross Domestic Product (which stands as proxy for the impact of the global financial meltdown) serves as the dependent variable while other money market indicators (TBs, CPs, Bas, CDs, BLR and INF) serve as the explanatory variables in the first and second models. The findings from the empirical analysis showed that in the non-crisis era (2000-2005) the explanatory variables all met apriori expectation. However, in the crisis era, only the coefficient of inflation retained its apriori sign.