Monetary Policy and Capital Inflows in Nigeria


  • Philip Ifeakachukwu Nwosa
  • Saheed Adeolu Babawale


Monetary Policy, Interest Rate, Capital Inflows, ARDL


This research centered on Nigeria and employed time series data covering 1981-2022. It utilized
time series data on interest rate, inflation rate, broad money supply and exchange rate. The time
series data were obtained from 2021 edition of the Statistical Bulletin of the Central Bank of
Nigeria while time series data on capital inflows was sourced from the bulletin of the World
Bank. The time series data were analyzed using descriptive and the auto-regressive distributed
lag approach. The outcomes of the ARDL established that monetary policy is an important driver
of capital inflows in Nigeria. Thus, the study concluded that monetary policy variables in Nigeria
are important in influencing capital inflows. The recommendation of this research is that the
government needs to curtail the persistent increase in inflation rate, which has adversely affected
the movement international capital into Nigeria.