Impact of Government Monetary Policy on Agricultural Sector Growth in Nigeria

The research is a study of government monetary policy and agricultural sector growth in Nigeria covering time series data from 1990-2022. It investigated the impact of government monetary policy on agricultural sector output using crop production output as proxy. The variables included in the model are CRPO as proxy for agricultural sector output, ACGS as proxy for agricultural credit guarantee scheme, INTR representing interest rate, MONS as money supply and RFALL a proxy for rainfall. These data were sourced from central bank of Nigeria (CBN), Federal Bureau of Statistics (FBS), World Bank data portal, commercial banks and climate change knowledge portal. The Ordinary Least Square (OLS) multiple regressions was used to estimate the parameters and the results revealed a positive and significant relationship between ACGS and CRPO while the relationship between RFALL and CRPO was also positive but insignificant. The relationship between INTR, MONS and CRPO was negative and insignificant. About 78% of the variation in CRPO was adequately explained by the variations in the dependent variables. The study concluded that ACGS, INTR and RFALL impacted on agricultural sector growth while MONS was seen as not significantly impacting on the sector. The study recommended strict adherence to policy on agricultural credit guarantee scheme, fair interest rate placement and proper monitoring loan granting commercial banks, harmonization of policies that has to do with interest rate and money supply and provision of alternative sources of water during drought and during dry season.