Exchange Rate Fluctuation and Inflation Nexus in Nigeria: The Case of Recent Recession


  • Ismaila Akanni Yusuf Department of Mathematics and Computer Science, Heriot Watt University, Scotland, United Kingdom
  • Mohammed Bashir Salaudeen Department of Economics, Lead City University, Ibadan, Nigeria
  • Isaac Azubuike Ogbuji Department of Finance, University of Lagos, Nigeria



Exchange rate, Inflation rate, Economic performance, Nigeria


The erratic performance of the Nigerian economy has generated theoretical and empirical debate in the literature. For instance, while some scholars have posited that inflation and currency depreciation positively influence a country’s economy, others believe the contrary. This leads to the interaction of both the exchange and inflation rates to arrive at an innovative conclusion. Hence, this study examines the effects of both indicators and their interactive effect of the country’s performance in the regulation era between 1986 to 2019, using the autoregressive distributed lag estimation technique. The empirical findings reveal that the interaction of inflation and exchange rate has a negative impact on the economy in the short run, but it is positive in the long run. Thus, the monetary authority should proactively control the foreign exchange rate movement to curtail the recent surge in inflation and boost the performance of the country’s economy.




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How to Cite

Yusuf, I. A., Salaudeen, M. B. and Ogbuji, I. A. (2022) “Exchange Rate Fluctuation and Inflation Nexus in Nigeria: The Case of Recent Recession”, Journal of Economic Impact, 4(1), pp. 81–87. doi: 10.52223/jei4012209.



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