The Impact of Money Supply on Inflation in Nigeria (1981 - 2021)

Abstract

This study examined the impact of money supply on inflation in Nigeria between 1981 and 2021, using Auto-Regressive Distributed Lag (ARDL) approach is employed to estimate long run relationship amongst variables. The data for the variables were sourced from CBN statistical Bulletin 2021 edition. The results of the test established a significant long run positive and negative relationship between Inflation and Interest towards money supply on inflation in Nigeria. Based on the results of the variables, it is therefore recommended that the policies put in place by the monetary and fiscal authorities in Nigeria should be such that will encourage the supply of money to a certain level in order to curb inflation in Nigeria in the short medium and long term.