THE EFFECT OF MONETARY POLICY ON THE FINANCE OF FOREIGN TRADE.
The purpose of this study is to determine the impact of monetary policy on foreign trade financing. To do this data were collected from both primary and secondary source. Primary sources include CBN Officials while secondary sources include textbooks, journals etc. the major instrument for data collected is the questionnaire, the data are presented in table and analyzed with chi-square. Having analyzed the data, the following finding were made.
CHAPTER ONE
Introduction 1
CHAPTER TWO
Literature review 9
CHAPTER THREE
Hypothesis, methodology of the study, sources
of data and limitation of the study. 22
CHAPTER FOUR
4.1 data presentation 28
CHAPTER FIVE
Summary, conclusion, recommendation. 37
Bibliography. 42
Appendix 43
INTRODUCTION
A number of monetary and Economic policy measures have been included in the Nigerian Economic since the 1980’s not only to achieve macro-economic stability but also to enhance foreign trade financing. But unfortunately, these policy measure have resulted in inflationary pressure, depreciated foreign exchange rate increasing foreign debt and deficit balance of payment (Ogwuma 1997).
Consequently the cost of foreign exchange has risen astronomically while foreign exchange inflow has dwindled significantly. This situation has mounted pressure on foreign exchange budget and adversely affected the financing of foreign trade.
The aim of the study is to examine the effect of the monetary policy on the finance of foreign trade thus;
This work is selected for the view of finding the ways by which foreign trade can be financed and improved through the help of monetary policy measures. The adjustment of the monetary policy of Nation plays a very important role in the finance of its foreign trade.
The monetary policy affects foreign trade financing through guiding deregulation of foreign exchange market, inter-bank lending, monetization of foreign exchange earning for petroleum export devaluation and domestic price stabilization. The study is relevant for numerous reasons. Foreign trade play a very important role in any country’s economy and any distortion is bound to have a ripple effect on the economy to avoid such distortions. The Government (through the central bank of Nigeria) need to know how well their monetary policies measures is use, whether it is achieving the desired objective of stabilizing the affairs of the Economy and improving the finance of foreign trade.
This study will be of immense help to the federal Government as it will expose to them the various monetary policy to be adopted in order to achieve a good or favourable foreign trade.
To the General Public and Financial Institution, this study will help them realize the needs to improve on the finance of foreign trade.
Finally, the study will aid researcher who might went to research further into this topic or those doing research in related topics a basis for further studies.
This work is selected for the view of finding the ways by which foreign trade can be finance and improve through the help of monetary policies measures. The adjustment of the monetary policy of a Nation plays a very important role in the finance of its foreign trade.
The monetary policy affects foreign trade financing through guiding deregulation of foreign exchange market, Inter – bank lending, monetization of foreign exchange earning from petroleum export devaluation and domestic price stabilization.
This study is relevant for numerous reasons foreign trade play a very important role in nay country’s economy and any distortion is bound to have a ripple effect on the economy to avoid such distortions. This study will be of immense help to the federal Government as it will expose to them the various monetary policy to be adopted in order to achieve a good or favourable foreign trade.
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