Abstract
This study examined the impact of selected monetary policy instruments on credit to the private sector in Nigeria. The study applied an auto-regressive distributed lag model (ARDL) for analysis of the data covering the period of 1981 to 2021. Data for the study were collected from the Central Bank of Nigeria (CBN) statistical bulletin. The objectives of the study were to: analyze the impact of monetary policy rate on credit to the private sector in Nigeria, examine the impact of liquidity ratio on the private sector credit in Nigeria. Liquidity ratio (LIQ) had a positive but statistically non-significant impact on credit to the private sector. Monetary policy rate (MPR) had a negative but statistically non-significant impact on credit to the private sector. The study recommends that the government needs to benchmark best practices in monetary policy development from those economies that are more advanced in order to develop better monetary control policies that can improve the performance of the banking industry for rapid economic growth and development.
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