ABSTRACT
Money market, like most financial market involved in the
intermediation of fund is the hub of any economy.
It is a common knowledge that operators often are strict for
trading of money market products/service, problems often arise on the
operations a grapple with such question on the following:
Whether the supervisory role of the regulators has any
impact on the money market operation?
Whether the operators operations affect the money market
operation?
Whether there is a hindrance in money market operation?
To offer suggestion on how to improve the money market
operation.
This project is vital in answering this question in relation
to money market
TABLE OF CONTENT
Title page——————————————–i
Certification page———————————–ii
Dedication——————————————iii
Acknowledgement———————————iv
Abstract———————————————-v
Table of
content———————————–vi
CHAPTER ONE
Introduction————————————— 1
1.1 Background of the
study————————– 2
1.2 Statement of
the problem ———————-4
1.3 Objective of the
study————————— -5
1.4 Research
questions——————————- -6
1.5 Significance of
the study ———————– -7
1.6 Scope of the study ———————————8
1.7 Limitation of the
study————————– –9
1.8 Definition of
terms—————————— –9
CHAPTER TWO
Review of related literature ———————–12
Money market in the Nigerian financial system–12
Reasons for money market establishment——-14
Features of money market————————-16
Operators in money market———————–17
Regulators of money market———————-19
Instrument of control—————————— 22
Instruments of money market———————29
Money market in the National Development——32
Hindrances in money market operation———- 34
Summary—————————————– 37
CHAPTER THREE
Research design and methodology ————-39
Introduction ———————————39
Research design —————————–39
Sources /method of
data collection ——-40
Population and sample
size—————–41
Sample techniques———————–41
Validity and reliability of measuring instruments —————46
Method of data analysis. —————–42
CHAPTER FOUR
Presentation and analysis of data—————43
Introduction———————————43
Presentation of
data————————44
Analysis of data——————————45
Interpretation of results.———————53
CHAPTER FIVE
5.0 Summary, Conclusion and Recommendation.—54
5.1 Summary——————————————54
5.2
Conclusion—————————————- 55
3.3
Recommendation———————————-55
References
—————————————57
CHAPTER ONE
1.0 INTRODUCTION
The money
market in our economy in a very vital sector and its position in the economy
cannot be over emphasized. The money market in Nigeria was fashioned along with
that of Britain, established and nurtured by the CBN primarily for mobilizing
domestic savings for productive investment as well as providing the government with funds to enable
it implement its economic programme.
Money market as
an intermediary for short term financial assets that are close substitute for
money consists of the CBN, Deposit money bank, Discount house, corporate
bodies, individuals, finance companies Bureau de change as its major operators
and deals on various financial instrument such as bills, certificates,
commercial papers, certificate of deposit etc which one transferable and
desirable in nature.
Notwithstanding, the recent global economic meltdown which tends to set
a disjunction between the surplus and the deficit sectors, the surplus sector
appears not to be interested in lending
to the deficit sector, this pose a serious bottleneck to the proper functioning
of the money market, thereby reducing the level of investment in the economy.
The logic question now is what would be the lot of Nigerian economic and its
inhabitants in general.
1.1 BACKGROUND OF THE STUDY
These are various financial markets which are institutional
arrangements that facilitates the
intermediation of funds in an economy. They financial market is segmented
into two- of is money market, which
deals in short term funds and the other
capital market that is for long term
dealing in funds ( Anyanwu 1996). The
basis of distinction between the money markets and the capital market lies in
the degree of liquidity of instruments bought and sold in each of the market which can be further sub –divided into primary and
secondary markets, while primary market is concerned with the raising of new
funds, the secondary market exist for the sale and purchasing of existing
centuries that are already in people’s
hands thus, enabling savers who purchase securities when they have surplus
funds to recover their money when they are in need of cash to (Afolaki 1991).
Money market play a
key role in banks liquidity management
and transmission of monetary policy. In normal times, money markets are
among the most liquid in the financial sector. By providing the appropriate
instruments and partners for liquidity trading the money market allows the
refinancing of short-term and medium
term positions and facilitates the mitigations of your business liquidity risk.
The banking system and the money market
represent the exclusive setting monetary policy operates in a developed active an efficient inte banks market enhances
the efficient of central banks monetary policy, transmitting its impulses into
the economy best thus the development of the money market smoothes the progress of financial intermediation and boosts lending
to the economy , hence improving the
country’s economic and social welfare.
Therefore, the development of the money market is in all stakeholders interest the banking
system itself the central banks
and the economy on the whole.
1.2 STATEMENT OF THE PROBLEM
The role of the financial
market in the development of the real sector and the economy at already
cannot be overemphasized.
A critical
characteristics of the money market is that it should deep and broad so as to absorb large volume of transactions without significant
effect on security prices and interest
this characteristics requires that these exist many active market participatant
such that the transaction of an individual investors will have just
infinitesimal effect on security prices
are interest rates the characteristics also requires that there are always
alternative investment instrument
available to satisfy the respective return risk desires of investors in
markets.
A money market that has depth and breath will be
informationally as well as operationally efficient and will contribute
significantly to the growth of the economy therefore these is need to examine
this crucial market and evaluate. Its
performance in terms of its contribution
to economic development.