Flexible exchange rate crucial for Nigeria's economic growth, study finds.
The impact of foreign exchange rate on Nigeria's economic growth was studied from 1981 to 2017. The researchers used data on exchange rates, inflation, money supply, interest rates, GDP, foreign investment, oil revenue, and trade openness. They found that a higher exchange rate negatively affects economic growth in the long run. Money supply has a negative impact on GDP in the short term but a positive impact in the long term. Inflation rates negatively affect GDP in both the short and long term. The study suggests that Nigeria should adopt a flexible exchange rate to improve economic growth.