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Impact of Exchange Rate Fluctuation on Selected Economic Sectors of the Nigerian Economy







CHIMEZIE Isabella Chinonye

NDUBUAKU Victor C. 1 ,

ONWUKA Kizito 1 ONYEDIKA Chukwuka 1 CHIMEZIE Isabella Chinonye 1 
  1. Department of Accountancy, Federal College of Agriculture Ishiagu, Ebonyi State, Nigeria. 1

Pages: 21-36

DOI: 10.18488/journal.26.2019.81.21.36

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Article History:

Received: 17 December, 2018
Revised: 24 January, 2019
Accepted: 28 February, 2019
Published: 03 May, 2019


The study investigated the impact of exchange rate fluctuation on selected economic sectors of the Nigerian economy. The study covered the agricultural (AGDP), manufacturing (MGDP), petroleum (PGDP) and service sector (SGDP) of the Nigerian economy. The petroleum sector represented the oil sector while the agricultural (AGDP), manufacturing (MGDP), and service sector (SGDP) represented the non-oil sector. The main objective of the study was to determine whether exchange rate fluctuations had a significant impact on the selected sectors of the economy. These sectors were invariably the largest contributors to the GDP. The time scope covered 1981-2016. Data for the study were obtained specifically from CBN statistical bulletin (2016). The data were analysed using the Auto Regressive Distributed Lagged (ARDL) model. The study concluded that there was no significant impact of exchange rate on AGDP, MGDP and SGDP respectively. However, there was a positive and significant impact of exchange rate on PGDP. The study recommended that Nigeria’s economy should be diversified to enable the non-oil sector to become significant foreign exchange earners.
Contribution/ Originality
This study contributes to the existing literature by unbundling Nigeria’s economy into its component sectors and determining the impact of exchange rate fluctuations on each sector. This study uses a relatively new estimation methodology of Auto-Regressive Distributed Lagged model (ARDL). This study originates a new formula which integrates lagged variables into the model.


ARDL, Exchange rate, Inflation rate, Agriculture, Manufacturing, Petroleum, Economic growth, Nigeria.



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This study received no specific financial support.

Competing Interests:

The authors declare that they have no competing interests.


All authors contributed equally to the conception and design of the study.

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