The Impact Of Exchange Rate Fluctuations On Economic Growth In Nigeria

ABSTRACT

This study evaluates the relationship between exchange rate fluctuations and its impact on the Nigerian economic growth. This study made use of secondary annual data from the Central Bank of Nigeria (CBN)’s statistical bulletin & publications from the National Bureau of statistics (NBS). This study adopted the classical least regression model and ordinary least square method (OLS) to analyze the data. This study has been able to demonstrate that exchange rate fluctuations is pivotal to the economic growth of Nigeria, other economic variables used in this study ((EXR) exchange rate, (INT) interest rate, (INF) inflation rate and (TB) trade) may result in a direct impact on the Nigerian economic growth. The study concludes that Since exchange rate fluctuation has a direct impact on the economy. There is need to develop an effective exchange rate regime. An efficient exchange rate would help to curtail inflation, improve Nigeria’s balance of trade, and boost Nigeria’s production capacity which are key indicators of positive economic growth.