Financial deepening and manufacturing sector growth in

This study examined the impact of financial deepening on manufacturing sector performance in Nigeria. The study specifically assessed the relationship between the ratio of broad money to GDP and the contribution of the manufacturing sector to GDP in Nigeria; interest rate spread and the contribution of the manufacturing sector to GDP in Nigeria and to determine the relationship between the ratio of credit to the private sector to GDP and the contribution of the manufacturing sector to GDP in Nigeria. To achieve these objectives, the study adopted an ex-pose facto research design. The desk survey method was used to collect time series data from the CBN statistical Bulletin for 1985 to 2014. The ordinary least squared multiple regression technique was used to analyse the data. Result from the analyses revealed that the there is an insignificant inverse relationship between private sector credit to GDP and the contribution of manufacturing sector to GDP in Nigeria. Again, the study showed an insignificant positive relationship between broad money supply to GDP and the contribution of manufacturing sector to GDP in Nigeria. Lastly, it was discovered that there is a significant inverse relationship between credit to the private sector and the contribution of the manufacturing sector to GDP in Nigeria. On the basis of these findings, it was recommended monetary authorities should monitor lending institutions financing instruments/packages, to eliminate ineffective ones and strength effective ones. Also, Lending institutions to strengthen their loan appraisal and monitoring team to effectively follow up loans granted to manufacturers to ensure that funds are used appropriately and on the right projects. Lastly, monetary authorities should formulate policies to bridge the gap between lending rate and deposit rate to encourage manufacturers to seek funding from financial institutions.