The research aims at examining the relationship between macroeconomic variables and the movement of share prices in Nigeria brewery industry, with emphasis on Nigeria Breweries Plc; the largest beer producing brewery firm in Nigeria. The level of association of the variables is validated using the ordinary least squares method, modeled in form of multiple regression. Granger causality method was applied to examine the causality relationship among the variables in the short run. Augmented Dickey- Fuller (ADF) test was conducted on all the variables, complemented with the Phillip-Perron’s (PP) test for unit root to check for data series stationary. All the variables except interest rate had the data series differenced at second difference as a result of their unit root issues. Interest rate was however differenced at level and intercept. The result indicates a positive but insignificant relationship between share price and inflationary rate, real GDP and exchange rate while a negative and insignificant relationship is found between share price and interest rate as only 13% of the variations in share price could be explained by the independent variables. Correlation between share price and all the independent variables are positive but largely weak. Granger causality test reveals no causal relationship between share price and interest rate, inflationary rate, real GDP and exchange rate in the short run. The paper recommends that macroeconomic variables should be seriously considered in setting monetary and fiscal policies because of its multiplier effect on the economy
Keywords: Brewery, Causalities, Macroeconomics, Regression, Share Prices, policies
