IDEAS home Printed from https://ideas.repec.org/a/eco/journ1/2024-06-30.html
   My bibliography  Save this article

Monetary Policy Instruments and Stock Market Returns Volatility in Nigeria

Author

Listed:
  • Emmanuel Othuke Akpokerere

    (Department of Banking and Finance, Faculty of Administration and Management, Delta State University of Science and Technology, Ozoro Delta State, Nigeria)

  • Azuoma Caroline Onojaife

    (Department of Office and Information Technology, Faculty of Administration and Management, Delta State University of Science and Technology, Ozoro Delta State, Nigeria)

  • Elizabeth Eloho Osevwe-Okoroyibo

    (Department Accountancy, Faculty of Administration and Management, Delta State University of Science and Technology, Ozoro Delta State, Nigeria)

Abstract

The study examines monetary policies instruments impact on stock market volatility in Nigeria for the period of 1993-2022. The study identified the independent variables, namely; reserve requirement (RR), cash reserve ratio (CRR), discount rate (DR) and money supply (MS) which were analyzed in relation to stock market volatility proxied with all share index volatility (ASIV). The data was analyzed with descriptive statistics, correlation matrix several diagnostics tests (VIF, validity test, ADF and Johansen tests) and the multiple regression analysis. The findings revealed that RR, CRR and MS have significant effect on ASIV while DR has insignificant effect on ASIV in Nigeria. It was concluded that reserve requirement, discount rate and money supply exert significant effect on Nigerian economy. Thus, it thereby recommended that management of CBN should put modalities in place to aggressively control ASIV in Nigeria. CBN should put measures in place to increase CRR. This will provide banks opportunity to fund economic transaction in the Nigerian economy, thereby reducing ASIV.

Suggested Citation

  • Emmanuel Othuke Akpokerere & Azuoma Caroline Onojaife & Elizabeth Eloho Osevwe-Okoroyibo, 2024. "Monetary Policy Instruments and Stock Market Returns Volatility in Nigeria," International Journal of Economics and Financial Issues, Econjournals, vol. 14(6), pages 273-282, October.
    • Handle: RePEc:eco:journ1:2024-06-30
    as

    Download full text from publisher

    File URL: https://www.econjournals.com/index.php/ijefi/article/download/17087/8352
    Download Restriction: no
    File URL: https://www.econjournals.com/index.php/ijefi/article/view/17087
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Cordelia Onyinyechi Omodero, 2019. "Effect of Money Supply on Economic Growth: A Comparative Study of Nigeria and Ghana," International Journal of Social Science Studies, Redfame publishing, vol. 7(3), pages 16-23, May.
    2. Izunobi Anthony Okechukwu & Nzotta Samuel Mbadike & Ugwuanyim Geoffrey & Benedict Anayochukwu Ozurumba, 2019. "Effects of Exchange Rate, Interest Rate, and Inflation on Stock Market Returns Volatility in Nigeria," International Journal of Management Science and Business Administration, Inovatus Services Ltd., vol. 5(6), pages 38-47, September.
    3. Justin .C. Alugbuo & Ekwugha Juliet Chika, 2020. "Monetary Policy and Stock Market Performance: Evidence from Nigeria Stock Exchange Market," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 4(6), pages 556-568, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Brendah Chepkorir & Onesmus Mbaabu & Lenity Maugu & Miriam Thuo, 2024. "Effect of Financial Deepening on Private Investment in Kenya," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 8(9), pages 2621-2636, September.
    2. Kunle Bankole Osinusi & Nurudeen Abiodun Lawal & Sodiq Olaide Bisiriyu, 2022. "Trade Balance, Exchange Rate and Money Supply in Nigeria: Growth Implications and Lesson for African Countries," Management & Economics Research Journal, Faculty of Economics, Commercial and Management Sciences, Ziane Achour University of Djelfa, vol. 4(2), pages 25-44, September.
    3. P. K. Mishra & S. K. Mishra, 2022. "Is the Impact of COVID-19 Significant in Determining Equity Market Integration? Insights from BRICS Economies," Global Journal of Emerging Market Economies, Emerging Markets Forum, vol. 14(2), pages 137-162, May.
    4. Kanu Success Ikechi & Nwadiubu Anthony, 2020. "Exchange Rate Volatility and International Trade in Nigeria," International Journal of Management Science and Business Administration, Inovatus Services Ltd., vol. 6(5), pages 56-72, July.

    More about this item

    Keywords

    Reserve Requirement; Cash Reserve Ratio; Discount Rate; Money Supply and Stock Market Volatility;
    All these keywords.

    JEL classification:

    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
    • G1 - Financial Economics - - General Financial Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eco:journ1:2024-06-30. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ilhan Ozturk (email available below). General contact details of provider: http://www.econjournals.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.