Monetary policy entails the government polices aimed at changing the quantity of money or credit condition; for example, open market operations or changes in required reserve rations etc. monetary policy involves changes in the quantity of money held by the public. In our Economy, there are two types of money most obriously. The Naira bills and coins which you have in your pocket are money; you can use them to buy hunch or go to a movie. But many purchases are not paid with” pocket money”.

Payment by cheque is very common. Since balances in checking account are used so commonly to make purchases, they are counted as part of the total quantity of money. Because of the importance of checking account money, a study of money include an examinations of how the banking works.

The major idea behind monetary police can be put quite simply. When people have more money in the form either of cash in their pocket or of balances in their checking account, the tend to spend more.

Thus, by taking steps to increase the quantity of money, the authorities can encourage spending. But if people may to buy more than the limited available supply of goods, the result is inflation.

Inflation therefore is defined as a high and persistent rise in price level inflation can cause business mistake for good decisions, businesses need an accurate picture of what is going on. When prices are rising rapidly the picture became obscured and out of focus. Decision- makers cannot see clearly. (for example business accounting is done in Naria terms). When then is rapid inflation, some businesses accounting may report profits, when on a more accurate calculation, they might actually be suffering losses consequently, inflation can temporarily hide problems. Our economy is complex and it depends on a continuous flow of accurate information.

Hence, the sole aim of this project is to assess the impact of various monetary policies in Nigeria and their effect on inflationary trends.

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY:

the beginning of inflation in Nigeria can be said to be a direct result of the polices of the country’s governments to stimulate a fast rate of economic growth and development since 1951 when material government was introduced. Inflationary trend since independence show two distinctions pend in terms of digital analysis.

However, the issue of monetary policy came to be in existence in order to be also a solution to the problem of inflation in Nigeria. We said that “Monetary policy is all measures adopted by monetary authorities to control the availability credit, total money in circulation etc in order to achieve some objectives which include; achieving of full employment, controlling of inflation achieving of economic growth and development, exchange rate stability.

Central bank however, can only achieve this objectives by applying the monetary policy instruments such as bank rate, open market operation (OMO), mural suation research rations etc.

Through, this monetary policy can be applied based on the type of problem facing the economy. This can be either expansionary or concretionary policy measure based don the situation the country is facing.

So, monetary policy serve as an avoid to the problem of inflation in the economy.

1.2 STATEMENT OF THE PROBLEM

The problem of inflation in Nigeria has been tackled in so many ways by the government of the country to put it to an end and government brought many adequate measures to combat this problems.

Despite all these measures, we still experience inflation in the country. The question now is, why do we still experience inflationary condition in domestic prices= This involves avoiding wide gyrations of prices which are highly upsetting to the economy.

Attainment of a high rate of , or full employment since there is always a certain amount of frictional unemployment.

Achievement of a high, rapid and sub-stainable economic growth. This means maximum sustainable high level of output, that is the most possible output with all resources employment to the greater. Possible extent, given the general social and organization structure of the society at any given time.

Maintenance of balance of payments equilibrium: This involves keeping international payments and receipts in equilibrium, that is, avoiding fundamental or persistent position.

Exchange rate stability: This involves avoiding wide gyrations or swings (undue and unnecessary fluctuations) in the currency exchange, rate. This is after all these adequate measure adopted by the government to step it.

More still, the issue of monetary policy has its objectives as solution to the problem of inflation. The central bank apply all measures to stop it, still very effort seem to be fruitless the next question is, why have all these measures failed in combating the problem of inflation.

1.3 PURPOSE/OBJECTIVES OF THE STUDY

The objectives of my study are as follows;

1. Attainment of high rate of, or full employment.

2. Achievement of a high rapid and sustainable economic growth

3. Maintenance of balance of payments equilibrium.