A Time-Series investigations of consumer price index dynamics and economic growth in Nigeria

Abstract

The study examined the impact of a time-series of consumer price index dynamics on economic growth in Nigeria, and the Secondary data covering 30 years, from 1993 to 2023, were employed in the research. For the analysis, the ARDL Bounds test for cointegration model technique was used. The consumer pricing index (CPI) result showed that, both in the short and long term, there is a significant negative relationship between the CPI and Nigeria's GDP. Also, only in the long term does the money supply (MS) have a positive impact on economic growth in Nigeria; the interest rate (INTR) has a negative impact on GDP. According to the study's findings, Nigeria's GDP is negatively influenced by the consumer price index (CPI). Given the short- and long-term negative effects of the consumer price index on economic growth, it is recommended that the Nigerian government should address supply-side constraints by boosting agricultural output, infrastructure investment, and manufacturing sector development. This will stabilize prices and reduce production costs, which will minimize supply-side and demand-side inflation.