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ABSTRACT
This study examined the effect of money market instruments on economic growth in Nigeria over the period of 1990 – 2022. The study’s objective is to analyze the impact of commercial paper on the economic growth in Nigeria, to assess the effect of bankers' acceptances on economic growth in Nigeria, to determine the influence of treasury bills on economic growth in Nigeria and to examine the role of certificates of deposit on economic growth in Nigeria. The Research design used in this study is the ex-post facto, employing the fully modified ordinary least squares (FMOLS) econometric technique to analyse the empirical model and examine the effect of money market instruments on economic growth in Nigeria. This study found that issuance of commercial paper positively and significantly affects economic growth in Nigeria, bankers' acceptances have an insignificant negative impact on economic growth in Nigeria, the study also found that treasury bills play a significant positive role on economic growth in Nigeria and lastly, certificate of deposit insignificantly and positively contributes to economic growth in Nigeria. The study concluded that money market instrument all significantly play a pivotal role in contributing to economic growth in Nigeria and therefore recommends fostering the development of a robust commercial paper market to address short-term liquidity needs, reviewing practices surrounding bankers' acceptances to enhance their effectiveness in economic development, leveraging treasury bills to support economic growth by broadening investor bases, and exploring ways to make certificates of deposit more attractive to investors through innovative strategies and financial literacy campaign.
