Paper Title
Inflationary Process Responsiveness To Monetary Policy Transmission Mechanism In Nigeria

Abstract
This paper examines the Inflationary Process Responsiveness to Monetary Policy Transmission Mechanism in Nigeria, by applying the vector Auto-regression approach. The choice of this period is to enable us have an idea of the Direct era, its transition to indirect control era and focus strictly on the era of market-based monetary regime which is what is in place right now and its subsequent effect on the Transmission Mechanism in Nigeria. We started with investigating the stochastic properties of the data using the Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) tests for unit roots. Both tests suggest that all the variables of interest which comprise of Oil prices, Fiscal deficit, Money supply Unemployment and Inflation are integrated at the second difference. Another test was conducted for the existence of long run equilibrium relationship between the variable, using the Johansen Multivariate approach. It was found that the variables were co-integrated, hence a Vector Error Correction Model was estimated which gave a negative result , implying that Monetary Policy has had no significant effect on Inflationary process in the period under review. Furthermore, the Granger causality test was carried out to know the causal link between Monetary Policy and Inflation. A bi-directional relationship was found to exist from Inflation to Money supply meaning , Money supply cannot be used to better predict Inflation. It is recommended that the government should embark on joint coordination of fiscal and monetary authorities with respect to liquidity flows in the economy to aid curb inflation. Furthermore, where deficit financing is inevitable, it should be put into productive activities in order to create more employment opportunities, raise national output, and increase the living standard of the people. Keywords- Inflationary, Monetary Policy, Transmission Mechanism, Vector Error Correction,