Sede.I.Peter

This study evaluates the impact of monetary policy on poverty in Nigeria over a 42-year period (1981– 2023), using time series data and the Autoregressive Distributed Lag (ARDL) model. It investigates the relationship between inflation rate, total Gross Domestic Product (GDP), money supply, interest rate or monetary policy rate, and poverty—measured by the poverty rate. Both short-run and long-run dynamics among these variables are explored. The empirical findings reveal an insignificant long-run relationship between monetary policy and poverty in Nigeria. However, short-run results indicate that persistent inflation worsens poverty by eroding individuals’ purchasing power. Increases in money supply and interest rates are also associated with rising poverty levels in the short term. Diagnostic tests confirm the robustness and reliability of the model, with no evidence of serial correlation or heteroskedasticity. The study concludes that monetary policy can aid poverty reduction and recommends reforms to stabilize inflation, promote inclusive and sustainable growth, and implement long-term structural policies