Monetary Policy and Economic Performance in sub-Saharan Africa

Abstract

This study examines the impact of monetary policy on economic performance in sub-Saharan Africa covering the period from 2005 to 2019. The study employs Blundell and Bond system GMM technique for the estimation. Three indicators - economic growth, foreign direct investment and gross domestic savings were used to proxy economic performance. The study reveals that monetary policy is an important factor in the determination of economic performance in the sub-Saharan African countries. The study concludes that sub-Saharan African countries could effectively use monetary policy to improve economic growth, attracts foreign investment and encourages domestic savings, which ultimately lead to well-being of the citizens.