Abstract:

This study examined the impact of liquidity management on inflation in Nigeria, Ghana, and Côte d'Ivoire over the period 1990–2024. Guided by the Monetarist Theory and the Quantity Theory of Money, it investigated the effects of broad money supply, monetary policy rate, exchange rate, gross domestic product, and government expenditure on inflation using annual secondary data. The study employed the Panel Autoregressive Distributed Lag (Panel ARDL) model with the Pooled Mean Group (PMG) estimator, while the Augmented Mean Group (AMG) and Common Correlated Effects Mean Group (CCEMG) estimators were used for robustness analysis. The findings showed that none of the explanatory variables had a statistically significant long-run effect on inflation under the PMG model, although significant error-correction terms confirmed convergence to long-run equilibrium with varying adjustment speeds across countries. Robustness estimates generally supported the main findings despite some differences in coefficient significance. The study concludes that inflation dynamics are shaped more by country-specific macroeconomic conditions and regional interdependencies than by the long-run effects of conventional liquidity management instruments. It therefore recommends country-specific liquidity management strategies alongside stronger regional macroeconomic policy coordination to promote price stability across ECOWAS.